Analysts Forecast 0.34% Drop In Brazil's 2009 GDP -Survey

SAO PAULO -- Brazilian economists and financial market analysts have revised upward their forecasts for 2009 gross domestic product, according to the central bank's weekly market survey published Monday.

Analysts expect Brazil's 2009 GDP to drop 0.34%, compared with a forecast of a 0.35% decline in the previous week's survey. Their forecast for 2010 GDP growth was increased to 3.8% from 3.6%.

Brazil's GDP shrank 1.8% in the first quarter of 2009 from the same quarter in 2008, according to the Brazilian Census Bureau, or IBGE.

The central bank's weekly survey tracks the opinions of 100 analysts and economists from banks and brokerages, reporting the average of their expectations.

Economists surveyed decreased their 2009 IPCA inflation forecast to 4.37% from 4.40%. The forecast is below the central bank's inflation forecast of 4.50% for the year.

The rolling 12-month IPCA inflation rate through July was 4.5%, according to the IBGE. The respondents' average estimate for 2010's IPCA inflation was reduced to 4.30% from 4.32%.

Analysts' average estimate for the 2009 year-end benchmark Selic interest rate was kept at 8.75%. Currently, the Selic rate is at 8.75%. For 2010, analysts maintained their Selic rate view at 9.25%.

The estimate for the 2009 year-end debt-to-GDP ratio was increased to 42% from 41.5%.

Respondents kept their forecast for the 2009 foreign-trade surplus at $23 billion. Analysts expect a 2009 year-end current account deficit of $15 billion.

Brazil's real is expected to end this year at BRL1.85 to the U.S. dollar, analysts said. On Friday, the real closed at BRL1.852.