BRASILIA (Reuters) - The outlook for Brazil’s economy deteriorated for an eleventh consecutive week, a central bank survey showed on Monday, and forecasts for the public finances pointed to record budget deficits amid the deepening coronavirus crisis.
The economy is now expected to shrink by 3.3% this year, according to the average forecast of over 100 financial institutions in the bank’s ‘FOCUS’ survey, compared with last week’s forecast of 3% contraction.
The government and central bank are sticking to their official forecast of zero growth for now, but are widely expected to revise that lower in due course.
The FOCUS survey also showed the government is expected to post a primary budget deficit this year of 6.2% of gross domestic product compared with 5% the week before, more in line with recent comments by Treasury and Economy Ministry officials.
Four weeks ago, economists forecast a primary deficit of 1.3% of GDP.
Average forecasts for the nominal budget deficit this year, which includes interest payments, deteriorated to 11.1% of GDP from 10% a week ago. Four weeks ago, the average forecast was for a budget shortfall of 6% of GDP.
Reporting by Jamie McGeever; Editing by Louise Heavens