Brazil raises 2023 economic growth forecast to 2 pct

The Central Bank of Brazil upgraded its economic growth forecast for 2023 from 1.2 percent in March to 2 percent, and lowered its inflation estimates for the coming years, showed the bank's quarterly report on Thursday.

The higher-than-expected 1.9 percent economic growth in the first quarter of 2023 was mainly ascribed to the agriculture and livestock sector. However, the evolution of the industrial and services sectors indicates that the economy continues to slow down, said the report.

The report forecasts 5 percent inflation for 2023, down from the 5.8 percent forecast in March, but still above the upper margin of tolerance of 4.75 percent set by the target rate of 3.25 percent with wiggle room of 1.5 percentage points.

Meanwhile, the inflation forecast for 2024 dropped from 3.6 to 3.4 percent, and for 2025, from 3.2 to 3.1 percent, with target inflation set at 3 percent for both years.