How Brazil’s economy hit a new low

It is no secret that Brazil has struggled severely with the COVID-19 pandemic. Its economy has definitely taken a toll and worsened throughout these past 2 years. Brazil was one of the countries with the most coronavirus cases globally, causing many to stay indoors and crippling the revenue in some businesses. With countless companies going out of business, the country’s financial situation has become worrisome. One of the main indicators that the economy has struggled, its inflation rate.

    On Wednesday, February 9th, the Brazilian government announced that the country’s inflation rate had reached its lowest since 2016. Despite having a relatively good month in January, when the inflation rate slowed down; it increased significantly in the beginning of February. The inflation rate in January was 0.54 percent, an upgrade from December’s 0.73 percent, however it remained the highest it had been in six years for the first month of the year, according to national statistics institute, IBGE. Food prices in January increased by 1.11 percent, as a pandemic induced supply chain shortage has seriously affected the population’s access to formerly cheaper food. 

    Brazil is coming off a poor ending to an even poorer 2021. They saw a decline towards the last quarter of the year and still haven’t found a way to get around these economic troubles. The coming months will be pivotal in order to not only address the economy but will be a determining factor in the upcoming October presidential elections.
Written by: Matias Gonçalves 
Edited by: Anna Kissajikian
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