Central Bank decides for strong increase in Selic to 2,75%

The Central Bank (BC) raised on Wednesday (17) the basic interest rate to 2.75% (+0.75 percentage points) and indicated that it may opt for a similar increase in its next meeting, to contain inflation, which is rising sharply due to the weakening economy caused by the sanitary crisis. The increase is the first in almost six years and surpassed the average market estimate of 0.5 percentage point, taking the Selic from the historic low of 2%, where it had remained since August 2020.

Source: UOL Economia

OECD links growth to judicial efficiency in Brazil

A study by the OECD suggests that Brazil needs to reduce judicial inefficiency and uncertainty in order to boost economic activity and overcome the current deep recession caused by Covid-19. Bankruptcy proceeding are also considered less efficient and more costly than in OECD members. A typical insolvency case takes four years in Brazil compared to 1.8 year in developed countries. Since the assets of companies in bad shape tend to lose value quickly, the debt recovery rate in Brazil with bankruptcies is only 18 cents per dollar, compared to 68 cents in rich countries.

Source: Valor International

Oil production in Brazil drops 8%

Brazil’s average oil production totalled 2.73 million barrels per day in February, down 8% compared to the same month a year earlier, ANP data showed. Adding up oil and gas production, the country produced an average of 3.55 million barrels of oil equivalent (boe/d) in the second month of the year, down 6% compared to a year earlier.

Source: Money Times

Ministry maintains economic growth forecast at 3.2% this year

The Secretariat of Economic Policy (SPE) of the Ministry of Economy maintained the projection for economic growth this year and raised the estimate for inflation, under the influence of high food prices. The projections are in the Macro-Fiscal Bulletin. The estimate for the increase in Gross Domestic Product (GDP) was maintained at 3.2%, in relation to the bulletin released in November last year. The GDP is the sum of all goods and services produced in the country.

Source: Jornal Contabil