The surplus of the Brazilian trade balance falls in March

The surplus of the Brazilian trade balance dropped from US$ 6.24 billion in March 2017 to US$ 4.99 billion in March 2019. This is the worst result for the month of March since 2016.

This drop of 22.3% is linked to the crisis in Argentina, Brazil's main trading partner in South America and a major buyer of Brazilian manufactured goods.

Some of the Brazilian products hit hardest by the fall in March are cargo vehicles (68.2%), passenger cars (41.4%) and auto parts (31.4%).

The Brazilian surplus of March 2019 is a result of US $ 18.120 billion in exports and US$ 13.130 billion in imports.

The product most exported by Brazil in the period was raw cotton, which had a 123.6% increase in exports.

The number of defaulted companies in Brazil grows

The number of companies in Brazil with debt increased by 5.02% in February 2019, compared to the same month last year.

The survey was carried out by the National Confederation of Shopkeepers (Confederação Nacional de Dirigentes Lojistas - CNDL) and the Credit Protection Service (Serviço de Proteção ao Crédito - SPC).

Banks and financial companies hold about 70% of the total debt. Therefore, this sector was the segment that most failed to receive from other companies.

Each indebted company has, on average, two accumulated financial arrears.

Default, without prior notice, reduces the ability to pay, directly affects cash flow, can cause losses for companies and can lead to bankruptcy.

This problem also affects the population. In 2018, more than 62 million Brazilians ended the year indebted. This represented an increase of 4.4% compared to 2017.

Brazil's GDP growth to be the lowest in 120 years

A projection by the Instituto Brasileiro de Economia (Brazilian Institute of Economics) of the Fundação Getúlio Vargas (Ibre/FGV) indicates that the average growth of the Brazilian economy should be only 0.9% per year between 2011 and 2020. If everything continues as it is, will have its weakest performance in 120 years.

According to Ibre/FGV analysis, the weak performance of the economy reflects the successive deficits in public accounts since 2014 and two consecutive years of recession in 2015 and 2016.

This rate is lower than the 1.6% of the so-called 'lost decade' in the 1980s when the Brazilian government declared a moratorium and suspended the payment of international creditors.

In 2015 Brazil's GDP fell by 3.5%. By 2016, the fall in GDP was 3.3%.

According to the Ibre/FGV researcher, Marcel Balassiano, the country would have to grow around 5.7% in 2019 and 2020 for this decade also not be considered a lost decade.

Overall, Brazil's economic recovery has been slow, the industry is struggling to catch up, and the Brazilian state is headed for a few more years of fiscal deficits.

Brazilian economy will only grow again in 2020, say businessmen

Brazil's business sector no longer believes that the country will grow again in 2019. According to José Carlos Martins, president of (CBIC (Brazilian Chamber of Construction Industry, in Portuguese, Câmara Brasileira da Indústria da Construção), the confrontations between the president of the Republic Jair Bolsonaro and the president of the Chamber of Deputies, Rodrigo Maia, are bad for the economy. According to Martins, "people take their foot off the accelerator, not to say they put their foot on the brake."

According to the Getúlio Vargas Foundation (FGV), the General Price Index - Market (IGP-M) increased 0.01% in January, a percentage higher than the one reached in December, when it varied -1.08%. As a result, the index accumulated a high of 6.74% in 12 months.

Meanwhile, the lack of capacity of Brazilian companies in the chemical sector, according to Fernando Figueiredo, chief executive of Abiquim (Brazilian Chemical Industry Association), stood at 23%. Simultaneously, the average idleness of Brazilian industry is 26%, according to FGV.

As the Brazilian economy continues to operate with a high level of idleness, the tendency is to maintain the high unemployment rate.

As the Brazilian economy continues to operate with a high rate of idleness, the tendency is the permanence of the high rate of unemployment in the country. Due to this environment of economic deceleration, the number of Brazilians without work reached a new record: 65 million people.

These 65 million are people of working age, but who are not working or looking for work. These are people who, after months of searching and frustration, give up looking for work.

Dollar reaches R$ 4.00 and scares Brazilian economists

A public discussion between the President of the Republic Jair Bolsonaro and the president of the Chamber of Deputies Rodrigo Maia made the financial market nervous this week.

Yesterday, March 28, the tourism dollar reached R$ 4.20 and euro at R$ 4.70. As a result, the day was turbulent in the Brazilian financial market.

Today, March 29, the commercial dollar opened the session with a fall of 0.84%, being traded at R $ 3.8830 for sale and R $ 3.8810 for purchase.

To make matters worse, unemployment continues high despite improvements in recent months. In the quarter ended in February, the unemployment rate in Brazil was 12.4%, according to data from the National Survey for Continuous Household Sample (Pesquisa Nacional por Amostra de Domicílios Contínua - PNAD) published today by the Brazilian Institute of Geography and Statistics (IBGE). In the same period in 2018, the unemployment rate measured by PNAD was 12.6%.

According to Eduardo Moreira (former partner of Banco Pactual), there is a fugue of investors from  Brazil. For Moreira, a critic of the Bolsonaro administration, the first three months of government did not present any type of project and indicated a fragility in the president's capacity for articulation with the National Congress.

Cost of living in Brazil: beans and potatoes

The rice and beans dish is a combination consumed daily by Brazilians. This dish is now more expensive because beans are now more expensive.

According to the Broad Consumer Price Index (Índice Nacional de Preços ao Consumidor Amplo 15 - IPCA-15), the price of this basic item, which had already registered a 34.56% increase in February, rose 41.44% in March.

This was one of the reasons for the IPCA-E, which is the IPCA-15 accumulated quarterly, to be 1.18%, above the rate of 0.87% registered in the same period of 2018.

Another item that also had a price increase was the potato. The kilo of this product rose 12.39% in February and 25.59% in March.

As a result, previous official inflation in March (IPCA-15) showed a 0.54% increase in prices in relation to the previous month

Former president of Brazil, Michel Temer, is arrested

The Operation Lava Jato of the Federal Police arrested today the ex-president Michel Temer and the ex-minister Moreira Franco. Both are accused of involvement in corruption schemes. In an interview with the journalist Kennedy Alencar, Temer classified his prison as "a barbarity."

The arrest was based on the donation of José Antunes Sobrinho, owner of Engevix. The businessman told the Federal Police that he paid R $ 1 million in tips at the request of Colonel João Baptista Lima Filho, who would have received the bribes for the political group of former president Michel Temer.

Engevix was one of the construction companies responsible for the construction of the Angra 3 atomic power plant, located on Itaorna beach, in Angra dos Reis, Rio de Janeiro.

Cost of living in Brazil in 2019

Inflation has rebounded in Brazil. According to the Brazilian Institute of Geography and Statistics (IBGE), official inflation accelerated to 0.43% in February 2019.

High food prices and school fees were the main factors for the month's high. In 12 months, the accumulated IPCA (National Wide Consumer Price Index) rose to 3.89%. Despite this rise in prices, inflation is below the government's target for 2019: 4.25%.

According to Fábio Romão, an economist at LCA Consultores, fuel prices are expected to pull up in inflation now in March.

The constant crisis produced by the current government and the possible difficulty to approve a profound Pension Reform may make a more moderate inflation picture unlikely.

The Bolsonaro paradox

The British magazine, The Economist, on its front page claims that a victory by right-wing candidate Jair Bolsonaro would be a catastrophe for Brazil.

Paulo Guedes, the economist responsible for the Bolsonaro government plan, said yesterday that a future Bolsonaro government will come back with a tax called CPMF, which will collect a portion of any financial transaction made in Brazil. Bolsonaro, meanwhile, spent the entire campaign stating that he will not raise taxes if elected.

Paradoxically, the right-wing and ultraliberal Bolsonaro leads the polls in a country where the population is largely against an ultraliberal government. Research indicates that most Brazilians want health and education services to be public. Programs such as Bolsa Familia, which protects people against hunger, are also widely aproved by the population.

Because of this, renowned statistician Paulo Guimarães, who helped countless politicians win elections in Brazil, believes that Bolsonaro may not make it to the second round of elections. In an interview for El Pais Brasil, Guimarães said that Bolsonaro's votes are not "of competence". They are "protesting, hateful against the other side".  For Guimarães, "the highest loyalty among the candidates is that of the Bolsonaro, but there is a very fluctuating part there, which is there because of hatred. If the voter realizes that he can win from the PT without hatred, he can change, but for that, one of those other center candidates has to appear with a vote that gives hope to the voter". 

Candidates from the center-left and center-right, such as Ciro Gomes and Geraldo Alckmin, respectively, have a few days to try to change that picture and win undecided voters and those who are not so loyal to Bolsonaro.

Presidential elections in Brazil

The election to the presidency of the Republic of Brazil is headed for a second round marked by radicalism. The left-wing candidate and the Workers' Party (PT), Fernando Haddad, former Minister of Education of Govern Lula and former mayor of the city of São Paulo, adopted a more radical agenda, which advocates raising taxes for the rich, democratization of the media, fight against the banking monopoly — in Brazil only five banks are responsible for 80% of the country's financial operations.

On the other side is Jair Bolsonaro from the tiny PSL, Partido Liberal Social, adopts an agenda that for many political analysts is far right. According to Celso Rocha de Barros, a doctorate in sociology from the University of Oxford, said on the last day in the newspaper Folha de S. Paulo that Bolsonaro's followers want to do a coup.

Bolsonaro, an ex-military man who has been in Brazilian politics for about 30 years and has been elected federal deputy many times, has spent the last few days adopting a speech that does not recognize the results of the election if not the winner. . His deputy, Colonel Mourão, also ex-military, said that if elected, will make a new constitution without the participation of the population, that is, according to Mourão, his government will make a new constitution made by a commission of notables.

If the dispute between Haddad and Bolsonaro is confirmed in the second round, Brazil will leave the election with a more radical government for both left and right. The question is: the country that is coming from a deep and deep recession will enter 2019 with a very difficult political agenda, regardless of who is elected.

Bitcoin fever arrives in Brazil

Brazilian media publishes an interactive map that shows which establishments in the world accept bitcoin. According to the report, it is possible to buy anything from sandwiches to cars. In Brazil, the bitcoins market is turning into a fever. Many Brazilians are spending clear nights to invest in these digital coins. States such as São Paulo and Paraná and Rio Grande Sul have the largest number of investors. In 2018, a shopping mall in Recife, Pernambuco's capital, will accept bitcoin as payment.