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Throughout 2011 Brazil has experienced many economic ups and downs. The stock exchange, the Bovespa, saw the value drops by 29% in late 2010 to early August, and 20% rally in October and November; Inflation reached 6.5% upper band of the government; The Real, climbed to 1.53 per US dollar and then fell two-year low of 1.90; and GDP, while it was strong most of the year have been revised downwards by economists. In November, according to data published by the Brazilian Central Bank showed that economic growth is still slowing down GDP growth forecast for 2011 to 3.2% and in 2012 it was 3.5% compared to 7.5% in 2010 the economic crisis is occurring and stagnant economies in the US, Brazil, in 2011 many were feeling the effects of the largest trading partners caught cold in Europe.
in 2012. However, we believe the outlook for the Brazilian economy is very positive. As the economies of the developed countries slowed the Brazilian government has taken a very proactive approach to help support the domestic economy. As we saw in the second half of 2011, the government was very quick to step in the interest rate reduction (even with high inflation environment) and new tax cuts designed to help boost and protect the local businesses. The government is leaning towards a rate cut will help economic growth and inflation looks like it will fall should see more positive signal is lower voltage to reduce the Brazilian economy, consumers and businesses alike.
in 2012 will be
still remains lingering fears of inflation. Despite the fact that inflation has been brought down using forecasts Brazil reduced interest rates stimulate economic demand, the economy can not adequately perform their own internal demand can lead to the re-appearance of unwanted inflationary growth. effects from the strong demand pressures, low employment and robust credit growth, supply constraints and infrastructure bottlenecks impede the great Brazilian efforts to keep inflation under control.
Asset bubbles are another problem with the booming Brazilian economy. Massive influx of cash their way into the country a lot of cash has helped fund several bank loans and fueled a potential property bubble. Sao Paulo alone, the price of newly built homes has gone up 31% in the past year and the price of some of the most luxurious destination has experienced more than 50% increase in value. Although household indebtedness and debt service costs, compared to net income is still growing in Brazil finds itself in a relatively safe position than most consumer debt is very short term and very high interest rates, which means that the consumer has only so much debt. Mortgage, although more and more popular, it is still at a low level as the most advanced countries.
Looking further increase in demand in Brazil in 2012 and will follow the example of more secure investments needed to keep up. The FIFA World Cup is only two and a half years later, the Olympics five years ago, and a huge oil reserves that still need to live large investments continue to be made in the areas of infrastructure, telecommunications and energy, reflecting the continued growth of the year come.
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Source by Aaron Kenney