We have downgraded our estimate for 2012 real GDP growth in Brazil to 1.0% (from 1.5% previously), as Q312 data indicate that the economic recovery is progressing more slowly than we expected. However, we continue to expect a significant pickup in economic activity in 2013. We forecast real GDP growth of 3.5%, as we expect a construction backlog to bolster growth and continued stimulus measures to modestly boost activity in the consumer and manufacturing sectors. Our core view for relatively weak private consumption remains in play. High household debt levels and weaker purchasing power on the back of the Brazilian …
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