Brazil’s economy may have grown by 3 percent in 2012, three times as much as originally reported, according to an ongoing review of GDP data that could solve one of the biggest economic puzzles since the global financial crisis.
If accurate, estimates from local consultancy LCA would help explain why unemployment remained so low and consumer prices failed to ease when Latin America’s economy looked so weak.
It would also suggest that President Dilma Rousseff and the central bank might have jumped the gun as they slashed interest rates and offered dozens of costly subsidies and tax cuts to jump-start an economy that may not have needed any stimulus at all.
The difficulty is that nobody will know for sure until after national elections due in October.
The consultancy’s calculations are based on recent studies that will be used by statistics agency IBGE in its next methodological revision of GDP data, due late this year or early 2015.