BRASILIA, July 14 (Reuters) – Brazil’s finance ministry on Thursday raised its hopes for economic growth this year as a result of the strong results seen on the monthly indicators, and retained its 2023 target.

Domestic sales are expected to rise by 2% instead of the previous 1.5% expected, according to Reuters reported on Tuesday. The ministry maintained GDP growth in 2023 at 2.5%.

Government estimates are more optimistic than that of market economists, who see a growth rate of 1.59% this year and 0.5% next year, according to a weekly central bank survey.

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Economic Policy Secretary Pedro Calhman said the government has seen strong economic downturns since May, in addition to labor market reforms and an increase in business capital.

All of them are showing hope for 2022 and confidence in the success of next year, he said at a press conference.

“We don’t see any reason to change what we want, we believe,” Calhman said.

The Secretariat of the Ministry for Economic Policy also lowered the 2022 inflation rate to 7.2% from 7.9% in May, in addition to what happened to Congress to reduce taxes on essential commodities, such as oil and energy.

However, the figure is still far from the 3.5% inflation target this year, with a margin of 1.5 percent above or below.

By 2023, the government now expects inflation to 4.5%, up from 3.6%, against the 3.25% controlled by the same 1.5 per cent group.

After Congress approved a significant increase in spending on transportation for the poor and other groups such as taxi and truck operators, Calhman said he did not see a drop in prices. read more

Finance Minister Paul Guedes said at a press conference that more than $ 57 billion of reais ($ 10.45 billion) this year, coming from stronger and more profitable taxes than expected, would support the 41 billion reais package.

According to Guedes, the extra money will also be used to repatriate tax cuts to the government to lower oil prices, ensuring that the 2022 budget does not affect politics.

($ 1 = $ 5,4533)

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Marcela Ayres reports; Edited by Hugh Lawson, Tomasz Janowski and Jonathan Oatis

Our Standards: Principles of Thomson Reuters Trust.

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