Demonstrations may have interfered with trade confidence, IBRE indicates

31 July 2013

The popular demonstrations that took place in June and July may have contributed to the decrease of the Trade Confidence Index (ICOM).
That's what FGV's Brazilian Institute of Economics (IBRE) indicates, which calculates the index.

According to the institute, the ICOM has evolved in an unfavorable manner between June and July, when it estimated a quarterly interannual change of minus 3.4%, against a fall of 3.0% in June on the same basis of comparison.

The average index of the quarter that ended in July remained at 121.1 points - the lowest of the historic series started in March 2010.

The result indicates sector deceleration at the beginning of the third quarter of 2013, when a decrease of Trade Confidence was determined by deterioration in the perception compared to the present moment.

The expectations have presented little change in relation to the following months, on the other hand, suggesting the possibility of some improvement with the fortuitous reduction of popular demonstrations and the return to a less tense socio-political framework in the coming months.

Even so, ICOM's negative record in July suggests an effective deterioration of the business environment and the possibility of further deceleration of the level of activity in the sector, now influenced by segments most sensitive to installment sales.

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