Global Leading Indicators

The Conference Board Leading Economic Index® for Brazil, together with Fundação Getulio Vargas (TCB/FGV Brazil LEI), increased by 0.9 percent in August 2022 to 114.6 (2016=100), after increasing by 0.3 percent in July. The LEI increased by 1.0 percent in the six-month period from February to August 2022, a turnaround from the 5.6 percent contraction over the previous six-month period.

The Conference Board Coincident Economic Index® for Brazil, together with Fundação Getulio Vargas (TCB/FGV Brazil CEI), increased by 1.7 percent in August to 110.8 (2016=100), after increasing by a similar 1.6 percent in July. The CEI grew by 4.8 percent in the six-month period between February and August 2022, an acceleration from 2.2 percent over the previous six-month period.

“Back-to-back monthly gains in the TCB/FGV Brazil LEI suggest the expectations for Brazil’s economy have improved, but the leading indicators suggest there are still challenges in the remaining months of 2022,” said Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board. “Inflationary pressures eased further, and the most recent gain in the LEI was driven primarily by improving consumer and business expectations. However, this better-than-expected improvement in Brazil may be temporary as uncertainty about global trade and durables production in Brazil remains. The Conference Board forecast of year-over-year real GDP growth for Brazil is still projected to slow to 1.5 percent in 2022.”

The TCB/FGV Brazil LEI increased in August

The improvement in the TCB/FGV Brazil LEI was driven primarily by financial components and consumer expectations

The trajectory of the Brazil LEI suggests moderate growth, but headwinds remain in the near term

are the key elements in an analytic system designed to signal peaks and troughs in the business cycle. The indexes are constructed to summarize and reveal common turning points in the economy in a clearer and more convincing manner than any individual component. The CEI is highly correlated with real GDP. The LEI is a predictive variable that anticipates (or “leads”) turning points in the business cycle by approximately 6 months. Shaded areas denote recession periods or economic contractions. The dates above the shaded areas show the chronology of peaks and troughs in the business cycle.

The seven components of The Conference Board Leading Economic Index^® for Brazil, together with Fundação Getulio Vargas (TCB/FGV Brazil LEI) include: Swap Rate - 1 year*, Ibovespa - Bovespa Index, Manufacturing Survey - Expectations Index, Services Sector Survey - Expectations Index, Consumers Survey - Expectations Index, Terms of Trade – Index, Physical Production - Durables Consumer Goods – Index, and the Exports - Quantum - Index.

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Created in 1944, FGV is a Brazilian private higher education institution, think tank and producer of statistics, with a mission "to foster Brazil’s socioeconomic development." The Brazilian Institute of Economics (IBRE) is FGV´s arm with the mission to produce and disseminate high-quality economic statistics and studies that are relevant to improve policies and private action in Brazil. www.fgv.br/ibre