Sunday, October 12, 2014

Brazil: Brasília Sharply Criticizes IMF Re: Scant Growth in 2014 at 0.3%

According to The Latin American TribuneBrazil strongly criticized Saturday (October 11) the International Monetary Fund’s “contradictory” forecasts about its economy, which the IMF predicts is coming to a screeching halt and urged the economic agency to reconsider its analysis more carefully and with greater realism.

“The recent analyses about Brazil have been contradictory. Maybe the IMF needs to consider more carefully its analyses before publishing them,” Brazilian Finance Minister Guido Mantega said in a statement presented on Saturday to the International Monetary and Financial Committee of the IMF.

The statement was presented as part of Brazil’s participation in the annual meeting of the IMF and the World Bank in Washington, at which the South American country is represented by Central Bank President Alexandre Tombini.

COMMENT: Particularly in light of the impending run-off election on October 26, it is assumed that particularly incumbent President Dilma Rousseff is notedly influenced by the IMF reporting.

This week the IMF again lowered the outlook for Brazil’s economic growth for 2014 to 0.3%, which could mean the smallest growth for the Brazilian economy since 2009--after having previously cut the projection to 1.3% in July from April’s 1.8%.

For 2015, the IMF estimate went from 1.4% to 0.6%, painting a very bleak picture of the nation’s economic future.

In the statement presented Saturday, Mantega, who did not make the trip to Washington, criticized the fact that the IMF blames Brazil’s slowdown on foreign demand in some cases and on internal demand in others, depending on the internal documents consulted.

He also noted that such contradictions are not only with regard to Brazil, but also with other emerging economies, which, he said, continue being those that keep “the global economy afloat.”

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