Synthesis of the Brazilian economy
Unfortunately, the expected severe aggravation of the pandemic in Brazil has proved true. In one month, the seven-day moving average of daily Covid deaths tripled, from 1.2 thousand to 3.1 thousand, setting a new world record. Indeed, the country’s daily death toll has exceeded the sum of the next 10 countries in the classification (with total population roughly tenfold higher than Brazil’s). Holidays have been rescheduled earlier in some regions, and restrictions on the functioning of nonessential services have been announced, which should result in some improvement in the situation during April. However, the shortage of vaccines is keeping the inoculation pace slow, placing more weight on social distancing to reduce the contagion and deaths, penalizing economic activity. In the midst of this health tragedy, unexpected decisions by the Supreme Court have put Lula back in the electoral dispute, provoking reactions both from society and politicians, starting with President Bolsonaro. The Centrão parties are greedily salivating over the public coffers, generating a veritable soap opera. The fiscal risk continues to pressure the exchange rate, in turn feeding inflation and leading to a hike in the SELIC rate in the midst of an economy that is showing signs of renewed weakness.
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