Taming inflation will affect growth?
“The data confirm that entrepreneurs are concerned about the effects of rising inflation and measures of containment of consumption on the economy that may affect the production of industries,” says CNI economist Marcelo Azevedo Souza.
Still a positive outlook
When forecasting the next six months, entrepreneurs are more positive, remaining at 62.7 points. Although down from 66.4 points recorded in the same month last year. Estimates of the Brazilian economy fell from 66.3 points to 57.3 points. The forecast performance of companies in the next six months fell from 67.9 points in July 2010 to 65.5 points this month. Both over 50 points.
Moreover, the index was below the historical average of 59.6 points. Despite the caution, the index still shows a certain amount of confidence in the economy, since values above 50 are positive, showing that entrepreneurs are confident. Below this limit, it indicates a lack of confidence.
The calculation of ICEI July is done based on interviews with 2,103 companies between 1 and 15 July. Among the industries surveyed, 1,127 are small, 684 and 292 are medium large. Source: CiasBrasil
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Hey Hildete!
I think the Brazilian small business owner has the same reflexes as here in the U.S. — whenever there is any uncertainty in the direction of factors that affect the business, slow it down and taker it slow…. Being a business owner, this is the first thing I do when any of the major economic flags start showing red, or even bright yellow with some of them (liking a dip in hiring, increasing interest rates, un uncontrolled inflation pattern)… Given most business owners may still be smarting from the early 90’s, they are probably all that more sensitive to economic indicators (I know I would be)…
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