Datafolha shows a more optimistic Brazilian about the economy, inflation and unemployment in 2022

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Brazilians are optimistic about the future of the country’s economy, its financial situation and the expectation of a drop in inflation and unemployment in 2022. The assessment of the economic environment in recent months, on the other hand, is quite negative.

This is shown by a Datafolha survey carried out from December 13th to 16th, with 3,666 Brazilians in 191 municipalities. The margin of error is two percentage points down or up.

For 42%, the country’s economic situation will improve in the coming months. For 20%, it will get worse. Another 35% say it will stay as it is.

The numbers are better than those verified at the end of 2020, when 28% expected improvement, 41% worse and 28% stability. At that time, there were more uncertainties and restrictions on circulation due to the health crisis caused by the coronavirus.

Expectations are now close to those verified in December 2019, before the pandemic, when 43% were optimistic, 24% pessimistic and 31% forecasting a stable situation.

In March of this year, during the second major wave of the pandemic, optimism reached the lowest point (11%) — and pessimism the highest (65%) — in the current administration.

According to Datafolha, the expectation of improvement is above average among entrepreneurs (50%), evangelicals (49%) and government supporters (65%). The assessment that it will get worse is higher among the richest (33%), people with higher education (29%) and those who fail the current president (28%).

Regarding the economic situation of the respondent, 56% believe it will improve, the highest percentage since the April 2019 survey (59%). 9% say it will get worse, the lowest value seen in the current presidential term.

Overall, 73% expect next year to be better than 2021 for all Brazilians, while only 8% say it will be worse and 15% think it will be the same.

Optimism is greatest among low-income people. About 75% of respondents from families with up to five minimum wages expect a better 2022. There are about 60% in the higher income brackets.

The positive expectation falls among respondents with more education. It is also smaller in the Southeast (68%) than in the Northeast (78%).

CURRENT SITUATION WAS WORSE

Although they are optimistic about the future, interviewees still have a negative assessment of the current situation of the Brazilian economy and its own finances.

To 65%, the country’s economic situation has worsened in recent months. There were 69% in the survey carried out three months ago, an oscillation at the limit of the margin of error.

The numbers are practically double those registered in the first year of the Jair Bolsonaro government. In other words, they are still far from the climate of the beginning of their term and the pre-pandemic period.

The percentage of respondents who saw an improvement rose from 11% in September to 13% in December this year. At the end of 2019, the number was at 28%.

In relation to their own situation, those who have seen improvement in recent months rose from 15% in September to 19% in December. There are 47% who claim to have seen a worsening, compared to 53% in September.

According to Datafolha, the financial situation improved to 30% in the income group above ten minimum wages —compared to 14% in the range of up to two salaries—, for 37% of businessmen and 35% of government supporters.

Looking at the cut by quarter, the Brazilian economy had been recovering from the recession caused by the pandemic until the first three months of this year. Since April, it has been practically stagnant, with the expectation that it will remain so throughout the next year.

Some economists estimate that the country remains in recession and should not get out of this situation in 2022.

INFLATION EXPECTATION

Inflation should drop from now on in the assessment of 26% of Brazilians, according to the Datafolha survey. This is the highest percentage registered in the current government in relation to this issue.

46% assess that inflation will rise, the lowest level registered in the current administration, tied in the margin of error with the results of April and August 2019 (45% and 46%, respectively). Another 23% claim that inflation will remain as it is.

In the survey carried out in September of this year, 69% were those who expected high inflation, 12% who saw a drop and 15% who were betting on stability.

Regarding the purchasing power of wages, 35% believe it will increase and 25% that it will fall. In both cases, they are the best brands in the Bolsonaro government.

Inflation projections show that the IPCA (consumer price index) will drop from around 10% at the end of this year to approximately 5% in 12 months. Inflation is expected to fall, but it will still remain above the central bank’s target (3.5% in 2022).

UNEMPLOYMENT

The survey also shows that, for 35% of respondents, unemployment will increase in 2022, the same rate as those who expect to fall. Both numbers are the best in the current administration.

The expectation of an increase in unemployment was always above 42% in the period 2019-2021, having reached a record level of 79% in March of this year.

In that same month, only 10% expected a drop in the unemployment indicator. In this case, the best result in the current administration was the 31% registered in the July and August 2019 surveys.

Regarding unemployment, Datafolha shows that 11% of workers are unemployed. Of these, 41% say they have not had a job for more than two years, 18% have been in this situation for more than a year and less than two years. Another 39% are unoccupied for less than a month to a year.

Market projections are for the maintenance of the unemployment rate at high levels (around 12%) until the end of 2023.

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