Brazil's Trade Confidence Index (TCOI), calculated by Fundação Getulio Vargas, increased 0.6 points in January 2017, changing to 78.9 from 78.3 points, the highest level since last October. In the metric of quarterly moving averages, the index decreased -0.3 points in the month.

“After gaining 10 points between February and August last year, trade confidence has stabilized in the range of 78 to 80 points in the last six months. The segment seems to be less concerned about the uncertainty of the political environment and more concerned about costs and the availability of credit for consumption. It is possible that the acceleration of the drop in interest rates signaled in January by the Central Bank contribute to Trade confidence - still very low in historical terms – registering gains in the coming months”, said Aloisio Campelo Jr., Superintendent of Public Statistics at FGV’s Brazilian Institute of Economics (IBRE).

The increase in the TCOI occurred in 10 of the 13 main segments surveyed and was determined by the improvement of the Current Situation Index, which increased by 1.2 points to 68.8 points, while the Expectations Index remained stable (-0.1 points) in relation to December 2016, reaching 89.9 points.

Among the indicators that comprise the Current Situation Index, the greatest contribution to the month's increase came from measuring the degree of satisfaction with the current volume of demand, which rose 4.7 points in relation to the previous month, to 69.7 points. The indicator that most contributed to the smooth decline of the Expectations Index was the one that measures the business situation in the next six months, with a decrease of 3.2 points in the month.

The complete study is available in Portuguese.