World Bank reduces Brazil's growth projection to 1.9% in 2026

The World Bank reduced, this Thursday (11), the growth projection of the Brazilian economy to 1.9% in 2026, compared to the estimated expansion of 2% in January.

According to the institution, the slowdown reflects the lower rate of household consumption, the maintenance of high interest rates and a more adverse external scenario.

Among the factors weighing on activity is the conflict in the Middle East, which has raised energy prices, put pressure on inflation and contributed to maintaining restrictive monetary conditions for longer.

The report also cites weakening global trade as an obstacle to growth.

"Growth is expected to slow in all regions in 2026, largely due to the fallout from the conflict in the Middle East, the slowdown in trade and tightening monetary conditions," the document states.

According to the Bank, "in Brazil, growth is projected to slow down amid lower consumption growth."

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The institution highlights that the projected decline for 2026 "is associated with softer growth in private consumption and exports compared to 2025, due to weakening global growth and tighter monetary conditions."

In this context, the institution also states that "disinflation has stagnated amid new pressures related to energy in Brazil", while tighter financial conditions continue to limit consumption and investments.

Despite the review, the institution assesses that the Brazilian economy continues to benefit from the good performance of commodity exports and projects average growth of 2.1% between 2027 and 2028.

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Source: CNN