Benjamin Steinbruch, the CEO of Brazilian steel and iron ore producer CSN, expressed pessimism for the Brazilian economy in a meeting with politicians, entrepreneurs, government officials and bankers this week in Brasilia.
According to media reports, Steinbruch said the level of inventories in the industry is very high, including the number of vehicles unsold at the auto industry, adding that the risk associated to a downturn in the country’s economic activity is very high. He said that the main driver for such scenario is the high level of interest rates in Brazil, cited as the highest in world terms.
The president of the Brazilian central bank, Roberto Campos Neto, responsible for the determination of the official interest rate, and who was also present in the meeting, warned that if interest rates are forced to decline, without considering the situation of the economy, the effect would be the opposite of that expected by the entrepreneurs.
CSN has recently posted a net loss of $165 million for the first quarter of 2023, against a net profit of $262 million for the same period in 2022.