Brazil needs World Cup boost
With the Football World Cup about to commence the Brazilian economy doesn’t look as if it would get past the pool stage. Brazil’s high inflation and low business investment has put a damper on the expected lift from government investment in projects leading up to the World Cup. Business investment fell 2.1% in the first three months of 2014, the biggest decline in two years. Brazil, the world’s seventh largest, has prices rising at 6% per year, above the central bank’s target. The central bank has kept its key interest rate at 11% in an effort to combat rising prices. Furthermore growth prospects have been revised down to 0.4% for the first quarter of this year. The graph below shows that slower consumption and investment will mean below average growth which is unusual considering they are hosting the Football World Cup and the Olympics.