Brazil

The Brazil economy has officially moved into a recession according to Finance Minister Guido Mantega and Dow Jones.

The announcement comes as Brazil GDP contracted 1.8% in the first quarter of 2009 year on year.

While the negative Brazil economic news is expected consider the impact of the global recession, the Brazil government is confident that the Brazil economy will recovery quickly as compared to developed countries such a the US and those in Europe.

The Brazil economy continues to see the Brazil central bank cut rates according to MarketWatch.

The recent Brazil economy rate cut is the third consecutive cut and puts the Brazil benchmark interest rate at 10.25% down 100 basis points from the cut on March 11.

The key driver of the trend by the Brazil central bank to cut rates is continues pressure on Brazil economic growth by the current global recession.

The Brazil economy posted a current account deficit of $1.64 billion in March which is significantly down for the $4.34 billion posted a year ago according to Reuters.

Nonetheless, economist expected the Brazil economy an account deficit of $664 million for the month. [Read more →]

National car sales in the Brazil economy rose 1% in February according to Dow Jones.

The key driver of the increase was due to a significant rise in Volkswagen sales which were up as much as 12% in January and 11% in February as VW’s Gol model continues to gain popularity and as Volkswagen continues prices reductions. [Read more →]

Coca-Cola Brazil has announced it will further invest in Brazil $764 million according to Dow Jones.

The Brazil investment commitment is 16.6% higher than last year and is a clear indication that Coke is committed to the Brazilian market.

Coca-Cola 2008 revenues were up 25% and sales volume grew 7% from the previous year from Brazil operations. [Read more →]

Brazil posted its first Brazil trade deficit in eight years as the global economic crisis takes hold according to Reuters.

The Brazil trade deficit of $518 million compares to a surplus of $922 million just a year earlier.

The key driver to the new Brazil trade deficit is a steep decline in exports plunging 29.2 percent from December and 26.3 percent year-on-year. [Read more →]

The Brazil economy saw industrial production decline by 12.4 percent in December according to Reuters.

The decline is worse than expected as the median forecast of 23 analysts suggested only a 6.6 decline in industrial production.

While the Brazil economy seemed to fair better than other BRIC emerging economies in 2008, there are continuing signs that Brazil is not immune to the negative impact of the global economic crisis. [Read more →]

President Luiz Inácio Lula da Silva, leader of the Brazil government, has made a conscience decision not attend the World Economic Forum in Davos, Switzerland according to Bloomberg.

The decision by Lula and the Brazil government is seen as a big blow to globalization as the world continues to struggle in the wake of the global economic crisis.

To add salt to the wound, Lula attended an anti-capitalist jamboree in the Amazon as an alternative to Davos which could be a clear sign that he is moving back to his populist tendencies that ultimately helped him get elected as president of the current Brazil government. [Read more →]

Brazil foreign direct investment (FDI) surged to $8.12 billion in December to give Brazil investment a record for 2008 according to Bloomberg.

Annually for 2008, Brazil Foreign Direct Investment (FDI) hit $45.1 billion despite the negative impact of the global economic crisis.

The Brazil government is relying on Brazil Foreign Direct Investment (FDI) as a means to finance its balance of payments and to counter the negative effects of investors who are pulling money out of Brazil’s capital markets. [Read more →]

The Brazil central bank cut interest rates to 12.75 from 13.75 percent to help spur the Brazil economy as the global economy slowdown continues to take hold of the BRIC economies according to AP.

The Brazil economic news puts Brazil’s interest rate at it lowest level since March of 2007 and forecasts expect the Brazil central bank to lower rates to 11.25 percent by 2010 in order to keep the Brazil economy growing.

While the decision to cuts rates was unanimous, three of the eight central bank committee members recommended only a 75 basic point reduction as opposed to the full point. [Read more →]

The Brazil Labor Ministry announced that the Brazil economy lost as much as 654 thousand jobs in December as the unemployment rate hit a seven year low to 6.8 percent according to Bloomberg.

The hardest hit sector of the Brazil economy was manufacturing with a total of 273,249 jobs lost.

The negative Brazil economic news continues to further the impact of the global economic crisis as the Brazil economy is now performing its worst since 2003. [Read more →]

Brazil’s central bank has announced it will lend $20 billion to businesses in order to pay international debt as the Brazil economy starts to feel the pain of the global economic slowdown according to Bloomberg.

Standard & Poor’s estimates that Brazilian companies have as much as $61.6 billion in foreign debt due in early 2009 and as much as $44.9 billion due in less than a year.

While the Brazil economy has weathered the global economic slowdown fairly well, Brazil economic activity fell 4.5 percent in December and has started to concern the Brazil government as it tries to hit its growth targets for the Brazil economy. [Read more →]

Brazil’s central bank has announced it will lend $20 billion to businesses in order to pay international debt as the Brazil economy starts to feel the pain of the global economic slowdown according to Bloomberg.

Standard & Poor’s estimates that Brazilian companies have as much as $61.6 billion in foreign debt due in early 2009 and as much as $44.9 billion due in less than a year.

While the Brazil economy has weathered the global economic slowdown fairly well, Brazil economic activity fell 4.5 percent in December and has started to concern the Brazil government as it tries to hit its growth targets for the Brazil economy. [Read more →]

The Brazilian Central Bank revised its growth forecast for the Brazil economy from 5 percent to 5.6 percent for 2008 according to AP.

In addition, the Brazil economy is expected to see an overall increase of 1.8 million to 1.95 million jobs for 2008.

Although the Brazilian economic news is positive, economist expect the Brazil economy to only grow 3.2 percent in 2009 as the global economic slowdown continues to take hold of the Brazil economy and other emerging market economies. [Read more →]

The central bank of Brazil lowered its inflation forecast for the Brazil economy to 6.2 percent for 2008 and 4.7 percent for 2009 according to Bloomberg.

Key drivers of the revised Brazil economic forecast include as reduction in commodities prices, lack of credit and a decline in Brazilian investment.

Along with the expected deflation, the Brazil economy is likely to only growth 3.2 percent in 2009 as opposed to the 5.6 percent forecast prior to the global economic slowdown. [Read more →]

Europe’s largest retailer, Carrefour, announced plans to invest in Brazil according to Bloomberg.

While the dollar figure of the Carrefour Brazil investment was not disclosed, the firm did state it would open as many as four more new stores in the Brazilian market.

Carrefour sees the Brazil investment as a path to making Brazil as the second biggest market for the Paris headquartered firm despite the global economic slowdown continues to plague developed and emerging economies. [Read more →]

The Brazil economy saw retail sales rise 10 percent in October according to Bloomberg.

The Brazil economic news beat forecast of 26 of 27 economist who expected the Brazilian economy to only see retails sales growth of 9 percent which is a surprise considering the global economic slowdown and its affect on the Brazil economy. [Read more →]

The Brazil government announced that it will cut taxes by $3.6 billion in an effort to help spur the Brazilian economy according to Bloomberg.

The Brazilian economic news comes as the Brazilian government attempts to hit its 4 percent growth target in the wake of the global economic crisis.

The tax cut plan will ease taxes on personal income and consumer loans as well as allow the central bank to help Brazilian companies repay debts through use of international reserves. [Read more →]

The Brazil economy grew 6.8 percent in third quarter according to AP.

The news from the IBGE statistics agency for the quarter comes just before the global economic that hit its hardest in October of this year so future expectations are likely to be reduced.

Several economists expect the Brazil economy to grow to about 5.2 percent for 2008. [Read more →]

The Brazilian economy has lost as much as 10,000 jobs in October according to AP.

Nonetheless, the Brazilian government is confident that the Brazil economy is uniquely positioned to weather the global economic crisis yet many expect further job losses as demand in leather products, shoes and furniture continue to decline.

In addition, Cyrela Brazil Realty SA, Brazil’s largest real estate developer has recently announced that it expects a rapid decline in building projects over next few months. [Read more →]

The Brazilian government expects the Brazil economy to grow 4 percent in 2009 compared to its original forecast of 5 percent according to AP.

The Brazilian economic outlook by the Brazil government is significantly higher as many independent analysts are projecting only a 3 percent growth rate for the Brazilian economy in 2009.

Nonetheless, the Brazilian government including the Central Bank President Henrique Meirelles is optimistic that the Brazilin economy will weather the global economic crisis storm. [Read more →]

Ford, the US based automaker, has announced that it will continue to invest in Brazil according to the Dow Jones Newswires.

The Brazil investment news comes as the world faces the threat of global recession and as Ford continues to see its share price deteriorate to just above $2.

Nonetheless, Ford plans to invest $1.5 billion in South America and the Mercosur trade bloc of which 85 percent is ear-marked for investment in Brazil.

Ford is currently the number 4 auto seller in Brazil and is expecting to sell over 300,000 cars by the end of 2008. [Read more →]

The Brazilian government maintains its 2009 growth forecast of 4 to 4.5 percent for the Brazil economy according to Reuters.

The statement comes as many other emerging economies are revising growth estimates down in the wake of the global financial crisis,

Nonetheless, a bigger threat to the Brazilian economy is the sharp decline in commodity prices. [Read more →]

South Korea’s biggest auto maker and the world’s fifth largest, Hyundai Motor Co, has announced plans to invest in Brazil according to Reuters.

The firm stated the Brazil investment will produce an annual capacity of 100,000 units and will cost $600 million to build a new automobile factory.

The factory is set to start production in 2011 and will be located in Piracicaba City just 100 miles outside of Sao Paulo. [Read more →]

US based Tyson Foods, the world’s largest processor and marketer of chicken, beef, and pork, has announced it will invest in Brazil according to Reuters.

The Brazilian investment involves the acquisition of three local Brazilian companies yet the names of neither the companies nor the acquisition values were disclosed.

The deal uniquely positions Tyson as Brazil is the world’s largest chicken and beef exporter. [Read more →]

Sara Lee Corp., the US based packaged-food giant, has announced it will acquire the Brazilian coffee producer Cafe Moka according to the Chicago Tribune.

While the size of the Brazil investment by Sara Lee was not disclosed, the deal does strenghten Sara Lee’s competitive position on the Brazilian market as Cafe Moka current sales account for aprroximately $65 million per year. [Read more →]

Magnesita Refractories, Latin America’s largest maker of specialty tiles, has announced its Brazilian investment of Germany’s LWB Refractories for $394 million according to Bloomberg.

The Brazilian investment deal is expected to make Magnesita the third-largest refractory-tile maker in the world with approximately $642 million in annual sales.

Magnesita currently controls 70 percent of the Brazilian market for tiles used in steelmaking. [Read more →]

The Brazil government has declined an invitation to join the cartel of the Organization of Petroleum Exporting Countries (OPEC) according to the Economic Times.

While the move would certainly enhance Brazil trade of oil, the political implications with the US at this time are likely not worth an acceptance as the invitation comes directly from the Iranian government.

Brazil’s newly found offshore oil fields discovered late last year expect Brazil export of oil to reach the same levels as Nigeria and possibly Venezuela which are current OPEC members. [Read more →]

Brazil industrial production output rose 8.5 percent year over year beating estimates according to Bloomberg.

The Brazilian economic news leads to expectations that the Brazilian central bank will likely raise interest rates next week further impacting the Brazil economy by slowing growth.

Brazil inflation for August is expected for released later this week and continues to creep up on the Brazilian government’s target upper range of 6.5 percent as Brazilian consumer prices in July hit 6.37 percent in July. [Read more →]

The Brazil government has requested that the WTO impose Brazil trade sanctions against the United States of up to $4 billion according to Forbes.

The WTO Brazil trade sanctions involve illegal cotton subsidies that the Brazil government claims are not compliant with WTO rules.

In addition, the Brazilian government believes the United States cotton grower ranking as the world’s second largest producer is largely due to its $12.5 billion in subsidy payments to American farmers between the years of 1999 and 2003.

Brazil trade of cotton places Brazil fifth in the world with China as number one. [Read more →]