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Brazil will review gross domestic product data for the third quarter to account for billions of dollars of exports that were underreported by the economy ministry in a serious calculation error.
The nation’s statistics institute known as IBGE will publish its review in March next year, to coincide with the release of the 2019 GDP results, it wrote on its website. Initial export figures published by the economy ministry for September through December were $6.5 billion shy of the actual number, but the correction came too late to include in the third-quarter result, IBGE said.
The miscalculation has had an impact on markets. The Brazilian real weakened on Nov. 25 when the central bank reported a widening current account gap due to a fall in exports. Three days later, the economy ministry said that technical problems had resulted in the underreporting of foreign sales in November. A further review on Monday showed that human error compiling export data in a new system had led to similar issues in the previous two months. The revisions helped strengthen the real against the dollar.
Brazil isn’t the only country experiencing a data fiasco. Denmark earlier this month revised growth numbers for the past three years, while Sweden has overestimated unemployment for months.
Creating Uncertainty
In Brazil, lower house speaker Rodrigo Maia said such reviews created uncertainties but at least should help calm down markets.
“A lot of investors were worried that Brazil would not be able to finance an increase in the current account deficit,” he told reporters on Wednesday. “However the review should at least improve the results and this should calm the foreign exchange market.“
The increase in exports is expected to boost the nominal third-quarter GDP result, which showed a 0.6% rise quarter-on-quarter. While reviews in exports data may be a common practice, the magnitude of the change was one of a kind, the economy ministry said.
The central bank said the revised export data will be taken into account in its current account report that will be released later this month, adding that the faulty data didn’t affect the currency flows figures.
The economy ministry said the data collection was done properly and that it had fixed the problem regarding the input of information into the system.
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