Brazil’s economy showed signs of rebound in the third quarter, mainly on spending and investment. The country’s economy is performing better than expected and is gearing up for 2021 as businesses and households recovered from the impacts of the first wave of the pandemic.
It is reported that Brazil’s GDP is still expected to stumble including Q4 and slowly in the first three months of next year. The economic recovery has been boosted by low interest rates and a huge spike in federal government spending to retaliate the economic devastation due to the pandemic. The death rate from the pandemic has ranked Brazil after the US.
It is reported that the GDP of South America’s number one economy has surged a record 9 percent in the third quarter compared to Q2, which recorded a 9.7 percent stumble.
Victor Beyruti, an economist at Guide Investimentos, told the media, “Other than the risk of a second coronavirus wave, the government will have to start indicating its commitment regarding the future of Brazil’s public debt. Excessive spending just made things worse from the fiscal point of view and now more than ever, reforms are necessary.”
According to a survey, families and businesses are bouncing back to their normal routine and only a few of them require state assistance. Most of the respondents believe that the surge in growth is driven by spending and investments.
Many global economies are still struggling to recover from the impacts of the pandemic. However, the future remains uncertain until a vaccine is rolled out.