Global and Latin American economic climate indicators worsen in fourth quarter

In Brazil, ICE fell a little, from minus 23.2 points to minus 25.0 points, as IE slipped from plus 50.0 points to plus 45.0 points. The Current Situation Indicator remained steady at minus 75.0 points, a result that has been repeated since April 2019.
经济学
12 十一月 2019
Global and Latin American economic climate indicators worsen in fourth quarter

The Ifo/FGV Economic Climate Index (ICE) for Latin America – an indicator calculated through a partnership between German Institute Ifo and FGV – has declined for the third consecutive month, from minus 26.4 points in July to minus 28.2 points in October.

Over the same period, the Expectations Indicator, positive since July 2016, slipped from 17.2 to 15.5 points. Meanwhile, the Current Situation Indicator for Latin America went from minus 61.3 points to minus 63.0 points. Looking at the average results for 2019, there have been deteriorations in both future expectations and evaluations of the current situation across Latin America in relation to last year. So far this year, the average Expectations Indicator is 16.7 points, down from 21.9 points in 2018. Meanwhile, the average Current Situation Indicator this year is minus 52.3 points, well under the already weak result of minus 35.3 points last year.

The economic climate in Latin America has been weaker than the global average since 2013. The drop in global ICE between July and October 2019, from minus 10.1 points to minus 18.8 points, was led by a sharp decline in perceptions of the current situation, from minus 5.4 points to minus 16.4 points, while the Expectations Indicator went from minus 14.7 points to minus 21.1 points. Unlike in Latin America, however, across the world, the expectations indicator results are worse than the current situation figures.

The deterioration in the economic climate in major economies contributed to the decline in global ICE. In particular, there was a considerable worsening in economic climate in the United States, where ICE went from positive to negative due to a 21-point drop in the Expectations Indicator, from minus 30.9 points in July to minus 51.9 points in October, while the Current Situation Indicator remained in the favorable zone of the cycle, slipping 4.7 points, from 49.1 to 44.4. All the world’s biggest economies saw a deteriorating economic climate in October, and only the United Kingdom and Russia recorded slight improvements in ICE in relation to the previous quarter.

In Brazil, ICE fell a little, from minus 23.2 points to minus 25.0 points, as IE slipped from plus 50.0 points to plus 45.0 points. The Current Situation Indicator remained steady at minus 75.0 points, a result that has been repeated since April 2019. The current situation evaluation has been negative in Brazil since July 2012. More favorable expectations than assessments of the current situation have been a characteristic of Brazil in recent years.

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