Brazilian GDP "probably" grew 2.2% in the second quarter according to the Bank of America.
In another report the economic policies minister Nelson Barbosa has told Rio based O Globo newspaper that Brazil's economy will grow by 4-5% this year.
Latin America's largest economy and part of the BRIC grouping of the world's most promising emerging markets, Brazil, although not immune to the global financial problems, is affected at minimal levels in contrast to many other countries as credit was not a facility readily available to the mass population...with little credit, comes little crunch, essentially.
The International Monetary Fund forecasted a 1.3% contraction in the Brazilian economy this year, however, it forecasts that the Brazilian economy will bounce back more virulently than most, growing by 2.5% in 2010.
That forecast of such a return to growth next year, makes Barbosa's forecast of a 4% growth this year plausible at least, given that most countries are either to see their recessions continue next year, or barely avoid a contraction; Argentina for example is to contract 1.5% this year and grow by just 0.7% next year. Of course in tumultuous economic times like this a forecast is just a glorified educated guess.
Whether Brazil's economy grows this year or not, this year and next are expected to be a blip in exceptional long-term growth forecasted for Brazil, which is expected to be the fifth largest economy in the world in 5-10 years.
This, as well as Brazil fantastic climate, carnival reputation, low cost of living, great beaches and cheap property have all made Brazil very popular with investors, and this is unlikely to be changed by a couple of rocky economic years. Indeed, real estate prices in the North East have for the most part stagnated at worst.
2009 - The time to buy real estate as developers are not behaving greedily, the prices and the terms that are on offer are exceptional.
2010 - Prices will start to increase and the most attractive of terms will most likely be withdrawn as the markets show signs of recovery.
2011-2014 Prices will no doubt increase, as the country gears itself as the host for the 2014 Soccer World Cup. Huge infrastructure improvements are set to be carried out that will make Brazil, particularly the cheaper North East, a more desirable place to both holiday and reside.
Liquid Market Strategy Team - 22 Jul 2009