I really like following the Focus Bulletin, as it is an average of the most important macroeconomic estimates here in Brazil.
What is the Focus Bulletin for?
The Focus Bulletin attempts to look into the future and provide us with insights into a probability matrix of economic events. With this, we can make our decisions more accurately.
Is the Focus Bulletin right?
The Focus Bulletin usually has a degree of error, according to my estimates, of up to 20% of the estimates made. But remember that even if this report is often wrong in its estimation, it still serves as a good reference and guidance for investors.
Who is the Focus Bulletin for?
It serves many people, not only investors , but also businesspeople, governments, and consumers. Let's look at some examples.
Let's say you are an agricultural businessman and are deciding on the best time to export your grains. So, the Focus Bulletin can help you make this decision, as it provides an idea of whether the exchange rate will appreciate or depreciate in the coming years.
You are a common consumer, who is not related to the market, but is deciding whether to take an international trip immediately or wait a little longer to obtain a more favorable exchange rate . In this sense, the Focus report can help.
You are a businessman in the metalworking sector and are having to decide whether to invest in the operational plant or wait a little longer. Read the Focus Bulletin and see if the GDP forecast for the coming years is promising.
You are part of the government and want to project revenue from tax collection to create budgets. Create a correlation between GDP and taxes collected and see the Focus Bulletin's forecasts for the coming years.
You are an investment fund manager or have received an inheritance and are wondering how to invest. Look at the Focus Bulletin , which contains a projection of returns above inflation for the coming years. With this, you decide whether to commit capital to risky assets or remain in fixed income.
What is the forecast for inflation and interest rates for 2024?
Image Source: Central Bank.
According to the current report, which came out today at 9 am, inflation of 3.94% is expected in 2024, with an interest rate of 9.25%. As a result, we see that investors will be increasingly attracted to risky investments , as the real gain from fixed income will be lower than it was in 2023 . However, if we look at GDP , we will have a growth of just 1.51%, raising the question: how will companies carry out their business and, therefore, leave profits and consequently dividends to shareholders, if the estimated economic activity will be lower? "