RICS Global Real Estate Weekly
|
Brazilian growth to end 2011 on a stronger note
 |
Following a sluggish third quarter in which Brazilian growth remained broadly flat, November saw a pick up in activity. Industrial production, after three consecutive months of decline recorded a 0.3% month on month rise. Additionally, the unemployment rate fell from 5.8% to 5.2% (the drop was partly due to seasonal factors), and consumer confidence also rebounded in November. Other positive data flow included the December inflation rate, which came in at 6.5% (the upper range of the central bank’s target), from 6.6% in November. The decline in inflation has enabled the Banco Central do Brazil (BCB) to avoid being in the uncomfortable position of exceeding the inflation target in the midst of an easing cycle.
Indeed, with the European debt crises hurting Brazilian growth in 2011 (likely to be 3%, down from 7.5% in 2010), the central bank has cut the Selic rate by 150bp in recent months to support the economy. The authorities also removed credit curbs and slashed taxes on some goods and investments in order to revive flagging credit growth. Total lending did rebound in November, rising 2% over the month from 0.6% in October. Mortgage finance also increased in November, bringing the annual rate of growth to an impressive 46%, with the government’s ‘My house, My life’ social housing programme aiming to construct two million social housing units between 2010-2013, with a budget of R$72 billion. This includes providing subsidised mortgages to low income families.
( Please click here to read full article )
|
|
