Published by FGV’s Brazilian Institute of Economics (IBRE) on January 2, the Business Confidence Index (ICE) for Brazil rose 1.2 points in December, totaling 93.1 points. After six consecutive months on the rise, this is the index’s highest level since April 2014 (95.7 points). 

“The year-end shows an improved perception regarding the current business scenario and a recovered sense of optimism. This scenario suggests that business confidence should continue to rise over the next few months, although we still expect some volatility due to lingering political uncertainties,” said Aloisio Campelo Jr., superintendent of Public Statistics at IBRE.

The Business Confidence Index (ICE) consolidates the indexes of all four sectors covered by business surveys carried out by FGV’s IBRE: Industry, Services, Trade and Construction.

The ICE’s high in December is linked to both the improved perception surrounding the current business scenario and short-term prospects. The Expectations Index (IE-E) rose 1.4 points, totaling 101.3 points – this is the first time the index made it above the 100-point mark since November 2013 (101.4 points). The Current Situation Index (ISA-E) rose 0.9 point, up to 87.6 points – the highest level since September 2014 (88.1 points).

Confidence rose across all four sectors surveyed by the ICE. The main factor behind such increase in December was the Services sector (0.5 point), followed by Industry and Trade (0.3 point each), and Construction (0.1 point). In December, the expected employment indicator (106.1 points) reached its highest level since March 2014 (108.3 points). The main factor behind the 2.2-point variation in this indicator was the Trade sector (1.4 points), followed by Industry (0.6 point) and Services (0.2 point).

Overview of 2017

The year 2017 was marked by the recovery of the indicator that measures the level of satisfaction regarding the current business situation. While the ICE’s high in 2016 was driven mainly by improved short-term expectations, the current situation indicator consistently contributed to the index’s increase in 2017. 

In December, confidence rose by 67% across all 49 segments surveyed by IBRE to calculate the ICE. Considering the quarterly moving averages, the ratio of segments high a margin increase is 60% of the total. Information was surveyed from 4918 companies between December 1^st and 26^th for the December 2017 edition of the index. The next ICE will be published on February 1, 2018. Go to the website to read the complete report.