Global Leading Indicators

The Conference Board Leading Economic Index® for Brazil, together with Fundação Getulio Vargas (TCB/FGV Brazil LEI), remained unchanged in July 2022 at 113.0 (2016=100), after increasing by 0.2 percent in June. The LEI increased by 0.4 percent in the six-month period from January to July 2022, a reversal from a 7.1 contraction during the previous six-month period.

The Conference Board Coincident Economic Index® for Brazil, together with Fundação Getulio Vargas (TCB/FGV Brazil CEI), increased by 0.5 percent in July to 109.6 (2016=100), after increasing by a similar 0.5 percent in June. The CEI grew by 4.2 percent in the six-month period between January and July 2022, an acceleration from 1.2 percent over the previous six-month period.

“The recent trajectory of the TCB/FGV Brazil LEI suggests the better-than-expected performance of the economy may be temporary as the index points to sluggish economic growth in the second half of the year,” said Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board. “Inflationary pressures eased recently -- driven by one-off reductions in the prices of electricity and fuel -- and consumer expectations and services activity expectations improved. However, this may be temporary. Amid high inflation risks and slowing global growth, The Conference Board forecasts year-over-year real GDP growth for Brazil will slow to 1.5 percent in 2022, down from 4.9 percent in 2021.”

The TCB/FGV Brazil LEI remained flat in July and economic headwinds remain

Strengths and weaknesses were roughly balanced among the components of the LEI for Brazil

The trajectory of the Brazil LEI suggests downside risks to economic growth remain in the near term

About The Conference Board Leading Economic Index^® for Brazil, together with Fundação Getulio Vargas (TCB/FGV Brazil LEI): The composite economic indexes 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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ABOUT FGV IBRE

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