The losses to the hotel sector in the month of April in Rio de Janeiro state, due to the pandemic of the COVID-19 and isolation measures, has been estimated at R$130 million ($24.6 million), according to sector representatives. But despite the grim news expected for April and May, officials say that a recovery should begin to be seen by June, and getting stronger during the second half of the year.
Brazil appears set to embark cautiously on unconventional monetary policy using small interventions to tackle dysfunction in bond markets, as it does with foreign exchange, but the severity of the crisis may ultimately force it to emulate the dramatic steps taken in the United States and Europe.
Brazil’s central bank president Roberto Campos Neto said that Latin America’s largest economy will begin to recover from the coronavirus crisis in the fourth quarter. Meanwhile, Presidente Jair Bolsonaro said that Brazil’s federal government will be expected to compensate states more than 100 billion reais (US$19.09 billion) in tax revenue lost due to lockdown policies that have negatively affected the economy, but he added that there is no room in the country’s budget to afford those costs.
Global demand for coffee has increased with more people looking for coffee during lockdown, but the already-tight supply could tighten even further as major coffee exporters Brazil, Colombia and Peru face difficulties in finding farmers to harvest coffee beans.
Brazil’s state-controlled development bank BNDES expects to finalize aid packages for companies in the auto, airlines, restaurant and energy sectors in May. BNDES president, Gustavo Montezano said that his organisation has an “appetite” to buy equity stakes in Brazilian companies to help them weather the coronavirus crisis, but that those stakes must be temporary.
