Brazil’s October retail sales unexpectedly rebound

David Biller – Bloomberg, 12/16/2015

Brazil’s retail sales rebounded in October, surprising analysts who expected a decline as the economy heads to its longest recession since 1931.

Sales jumped 0.6 percent, from a revised 0.3 percent decline in September, its first increase after eight straight drops, the national statistics agency said in Rio de Janeiro. All but one of 35 economists forecast sales would fall, according to a Bloomberg survey. The median forecast was for a 1.1 percent drop.

Brazil has sunk into recession as consumer confidence is undercut by above-target inflation, rising joblessness and the highest borrowing costs since 2006. The October jump is seen as an outlier by analysts at several banks, including BNP Paribas SA, Banco Bradesco SA, Banco Safra SA, and Banco Santander SA.

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Brazil’s Rousseff to cut key fiscal goal against Levy’s warning

Lissandra Paraguassu & Alonso Soto – Reuters, 12/15/2015

Dec 15 Brazil’s President Dilma Rousseff will cut a key fiscal savings goal for next year to safeguard an iconic welfare program, a senior lawmaker with knowledge of the matter said on Tuesday, a move that could raise tensions in her economic team.

Congressman Ricardo Teobaldo said the government asked him to alter the budget guidelines bill to reduce the 2016 primary surplus goal to 0.5 percent of the gross domestic product (GDP) from 0.7 percent.

The target measures the balance of government revenues versus spending excluding debt servicing payments, and is considered a key measure of debt sustainability and fiscal health.

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Farming flourishes amid Brazil’s fiscal mess

AG Web, 12/9/2015

Financial and political turmoil that put Brazil on the brink of a depression also is contributing to one of the best years ever for domestic farmers.

A consequence of economic stress in Latin America’s biggest country is a weak currency that has turbo-charged export revenue for everything from soybeans to beef to coffee. Even as global surpluses spark a commodity slump, the drop in the Brazilian real against the dollar is so steep that farmers still come out ahead. Agriculture revenue will rise to a sixth straight annual record this year and grow again in 2016, the government predicts.

“That’s the only part of the economy which is still evolving positively,” said Fabio Silveira, an economist at GO Associados, a consulting firm in Sao Paulo.

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