What to expect from the Brazilian economy

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With the sudden drop in the Brazilian economy caused by the pandemic, the situation has become relatively natural and tends to recover.

Last year (2021), according to the Brazilian Institute of Geography and Statistics ' indicator panel , the country's economy fell 0.4% in the 2nd quarter of 2021, in addition to the 0.1% in the 3rd quarter. And yet, the economy is expected to grow and be above its initial forecast of 3.9%, made in December 2021, reaching around 4.6% this year (2022).

Still, we cannot help but believe in the expectations of timid growth, after the recovery of the economy and the losses caused by the 3.9% drop in 2021, caused by COVID-19.

The path may be challenging for the Brazilian economy, which tends to remain with inflation still stagnant in double digits. The situation should imply an increase in interest rates, applied by the Central Bank .

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Expectations about commodities
Playing in favor of the Brazilian economy, commodities are audit directors auditors email database one of the factors that will be present in 2022.

The National Supply Company (Conab) expects 291.1 million tons of grains to be harvested in the 2021/22 cycle. The numbers are encouraging , as they indicate an increase of 15.1% compared to the last harvest, which was affected by climate problems.

And, without much surprise, the producers' focus will be on soybeans, of which China is the main importer. Production is estimated at 142.6 million tons of the grain, 4% more than in the previous harvest.

According to Conab, the corn harvest should also perform well. The forecast is that 117.2 million tons will be harvested, an increase of 34.6% compared to the last cycle.

Investment in states and infrastructure
The Brazilian Infrastructure and Basic Industries Association (Abdib) expects R$19.38 billion in investments for 2022, referring to contracts that have already been signed this year. In addition, the expectation is that R$140.54 billion will be invested in infrastructure.

According to XP , investments at higher levels, such as solid demand for capital goods for agriculture, oil, gas and sanitation, should also be maintained.

Motivated by greater cash availability, there is a chance that public investment by states will increase in 2022. This is because, due to the increase in revenue from ICMS , the collection is 16% higher than that recorded in 2019.

Anticipation of receivables increases
With the drop in credit made available by banks, the anticipation of receivables is a modality that tends to grow this year . Monitoring carried out by the Central Bank shows that anticipations grew by 50% at the beginning of January.