UPDATE 1-Brazil economic activity back above pre-pandemic levels in April

(Adds details on April numbers, economic context, graph)

By Jamie McGeever

BRAZIL, June 14 (Reuters) – Economic activity in Brazil rebounded in April from a rare drop in the previous month, as a central bank index showed on Monday, which marked a solid start to the second quarter, albeit not quite as strong as that Economists expected.

The central bank’s IBC-Br economic activity index, a leading indicator of gross domestic product, rose by a seasonally adjusted 0.44% in April, less than the 0.55% increase forecast by economists in a Reuters poll.

According to this metric, activity in Latin America’s largest economy is a fraction higher than it was before the pandemic in February last year.

The seasonally adjusted index was 139.65 in April, just above 139.35 in February last year, before the COVID-19 pandemic stalled the economy and caused the largest annual decline in economic activity since 1990.

The positive economic data of the past few months have triggered a wave of upward revisions to forecasts. According to a central bank poll on Monday, economists now expect the economy to grow by nearly 5% this year.

However, as measured by the IBC-Br Activity Index, Brazil’s economy is still 6% smaller than its peak in December 2013, seasonally adjusted.

The IBC-Br index has risen 15.9% on a non-seasonally adjusted basis since April 2020, the central bank said, reflecting the extent of the economic downturn at the time the pandemic broke out.

The index rose 4.77% on a non-seasonally adjusted basis for the first four months of the year, while the index fell 1.2% in the 12 months to April, the central bank said.

(Reporting by Jamie McGeever Editing by Gareth Jones and Giles Elgood)

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