⁍ The average forecast for 2020 gross domestic product is now showing a decline of 5.7%.

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⁍ The improvement is widely chalked up to the stronger-than-expected impact of 600 reais monthly ‘social transfer’ programs to low-paid workers.

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⁍ While it would still represent the steepest annual downturn on record, it is the most optimistic outlook since May.

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– Latin America’s biggest economy appears to be turning around after years of recession. Brazil’s economy shrank 5.7% in the second quarter compared to the first, but that’s smaller than the 6.5% analysts expected, according to a central bank survey, per Reuters. The country’s economy is expected to shrink 5.7% for the year as a whole, but that’s the smallest contraction on record, reports the Wall Street Journal. Economists had expected a decline of 6.5%. “The improvement is widely chalked up to the stronger-than-expected impact of 600 reais monthly ‘social transfer’ programs to low-paid workers, subsidies far-right President Jair Bolsonaro agreed to under pressure from Brazil’s congress,” says a professor of economics at Rio de Janeiro’s Universidade Federal Fluminense. “If the emergency aid ends and there is no similar type of income transfer program in its place to meet the needs of informal workers and poor families, there will be no growth, there will be no rebound. Even if a COVID vaccine is found, economic fragility is huge. The labor market won’t recover quickly … and if the government returns to austerity, there will be no broader recovery.’