A hot, dry spell in southeastern Brazil has pushed up energy prices, stretched government finances and raised the threat of water rationing in its largest city, Sao Paulo, just months before it hosts one of the world’s largest sport events, the soccer World Cup.
It looks like the last thing Brazil needed as it scrambles to woo investors and avoid a credit downgrade.
But if the scattered rains that started to pour down over the past few days bring in continued relief through March, the heat could actually prove to be a much-needed boost for Brazil’s economy, research firm LCA found.
The Sao Paulo-based firm calculated the net impact of above-average temperatures on gross domestic product. It found that the rush to buy air conditioners, combined with other reasons like the energy those air conditioners will consume, might push up Brazil’s quarterly growth in the first three months of 2014 by half a point to 1.0 percent.
Some retailers have reported an increase of 500 percent in air conditioner sales as many in Brazil’s rising middle-class got tired of sleepless, warm nights.