Bradesco revises GDP growth from 1% to 1.5% in 2023

Bradesco economists have improved their expectations for economic growth this year and now expect a 1.5% increase in GDP, compared to the previous forecast of 1%. The bank takes the lead in the review with expectations for more heated economic activity in 2023, especially due to the first half.

Signed by the bank’s chief economist, Fernando Honorato, the report released this Monday separates the perspective for Brazil into two moments. In the short term, the dynamic improves, but does not guarantee continuity in the future.

“Uncertainties for the medium-term scenario remain. The effects of the more restrictive monetary policy on economic activity will prevail. The definition of a framework capable of guaranteeing fiscal sustainability and the implementation of a growth and efficiency agenda can create the conditions for the convergence of interest rates to levels considered neutral”, says the document.

Despite a higher estimate for GDP, Bradesco has worsened the forecast for the behavior of inflation, which should end the year at 5.6%, from the 5.1% forecast a month ago.

“Inflation has been undergoing an upward revision, but core dynamics have been benign. We revised the 2023 IPCA from 5.1% to 5.7%. Our structural models continue to point to an exchange rate of R$/US$5.25, the level at which we maintain our projection for 2023”, he says.

Regarding other indicators for the economy, Bradesco expects a slight improvement in the public debt over GDP indicator, which should be 78.8%, compared to 79.5% in the previous forecast. Even so, the debt trajectory will continue to rise, reaching 81.5% in 2024.

For the growth of the global economy, the bank’s economists raised the forecast to 2.5% in 2023, from 2.1% before. “Despite this, the slowdown will still be relevant compared to 2022, when the world grew 3.0%, since the higher Chinese growth is more than offset by the cooling of the rest of the world”.