Cost of living in Brazil: January inflation is 0.21%, the lowest for January since the beginning of the Real Plan, in 1994

According to IBGE, the official inflation in Brazil, as measured by the Broad National Consumer Price Index (IPCA), decelerated to 0.21% in January of 2019, after registering an increase of 1.15% in December 2018. It is the lowest result for a month in January since the beginning of the Real Plan, in July 1994. In the accumulated of the last 12 months, the indicator registered 4.19%.

For economist Monica de Bolle, director of Latin American studies and emerging markets at Johns Hopkins University, "Brazil is experiencing a 'tropical version' of secular stagnation, with a stagnant economy, without reacting, and registering inflation contained below the target. It is not yet known what effect a reduction in interest rates could have on the economy in the current scenario".

To make matters worse, according to the International Monetary Fund (IMF), economic activity in Latin America and the Caribbean was stagnant in 2019, making it more challenging to resume growth in the region. The inflation figure for January in Brazil points to a certain stagnation remaining.

According to the IMF report, Brazil may grow by 2.2% this year and 2.3% in 2021 in the Gross Domestic Product (GDP). However, after the emergence of coronavirus cases in Wuhan, China, Brazil's main trading partner, these figures are being revised downwards by the Brazilian financial market.

According to the International Monetary Fund (IMF), the already slow economic recovery in Brazil is at risk

The International Monetary Fund (IMF) has warned this week of the risks posed by domestic and external shocks to the Brazilian economy. According to the IMF, these shocks can hinder the already slow recovery of the Brazilian economy.

According to the IMF, investments in Brazil "remains subdued, retained by idle capacity and persistent uncertainty about the prospects for fiscal and structural reforms. Weak global growth and recession in Argentina are affecting exports. The growth in 2019 is projected between 1% and 1.5%, with significant risks of decline."

For the IMF, the main risk related to the Brazilian economy is associated with the approval of a Pension Reform that generates a "robust" economy to the public coffers in the long term.

The Brazilian economy has one of the smallest growths on the planet

A study made by the Brazilian Institute of Economics of the Getúlio Vargas Foundation (Ibre/FGV) points out that, between 2011 and 2020, the expansion of the Brazilian economy should only surpass that of 18 countries among the 191 monitored by the International Monetary Fund (IMF).

According to the IMF, Brazil is expected to grow about 0.9% between 2011 to 2020, an estimate lower than the expected average in Latin America (1.7%) and global emerging economies (4.9%).

Unpredictability stalls Brazil's growth, whose GDP grew by 1.1% in 2018 and is expected to grow by less than 1.5% by 2019.

Four years ago, in April 2015, the IMF released some very pessimistic forecasts for Brazil for the decade 2011-2020, pointing to average growth of only 1.8% per year in the period. Today, we know today that these forecasts were extremely optimistic: we had two years of GDP fall of 3.5% and the peak of inflation in double digits. Worse, the average annual growth in the decade should run a frightening 0.8%, setting the second decade lost in a generation.

According to the economist Roberto Dumas, from the economic point of view, the 1980s in Brazil were called the "lost decade" due to a rampant inflationary process, public accounts in total uncontrolled, contracting with the International Monetary Fund ), as well as a strong devaluation of the currency due to ill-prepared economic plans.

Brazilian Stock Exchange (Bovespa) have the largest fall of the last two weeks

The Ibovespa, index that measures the price variation of the main shares traded on the Bovespa dropped 1.11% yesterday, April 3, 2019. The market saw with pessimism the statement of Economy Minister Paulo Guedes, who said that he will not assume the position of articulator of the Pension Reform in the Brazilian National Congress.

Also yesterday, the IMF reduced Brazil's GDP forecast in 2019. According to the IMF's World Economic Outlook report, Brazil's GDP growth forecast is now 2.1% in 2019. The forecast made in January 2019 by the same IMF was that the Brazilian GDP would grow around 2.5% this year.

In the Bolsonaro administration, there is no economic development plan for the country. Economy Minister Paulo Guedes believes growth will only come after the approval of the Pension Reform. However, several Brazilian economists like Nelson Marconi and Paulo Feldmann believe that the government should adopt other measures, in addition to the Pension Reform, to combat unemployment in the country.

The same IMF report pointed out that Venezuela's GDP fell by 18% in 2018 and should fall 25% in 2019. As a result of these declines, Venezuela's economy in 2020 will be almost half of what it was in 2017.

The inflation forecast by the IMF for Argentina in 2019 is 43.7%. Because of this, the IMF decided to release a US $ 10.8 billion pass-through to the Macri government, which was unable to resolve the economic crisis and faced a decline in its popularity. Over the past six months, some 2.7 million Argentines fell under the category of poor and destitute. In total, there are already 12.9 million poor and indigent people in the country with just over 44 million inhabitants.