Could being a World Cup favourite see more investment in Brazil?
Date added: 9th June, 2010 at 09:11
(view all articles from June, 2010)
Categories: Economy
Winning the World Cup may see greater investment in Brazil as the success would boost the nation's financial health, experts have said.
Goldman Sachs has predicted that the country's economy - already the ninth largest in the world - is set to grow a further 6.4 per cent this year and Tom Stevenson, investment director at Fidelity International, added that this figure has been continuously revised upwards as evidence of Brazil's strong recovery has emerged.
There are many companies in the nation, especially in the retail sector, which could see greater earnings from the football tournament, he added.
"This is because the economy benefits from a relatively high and growing level of domestic consumption that is being driven by an expanding middle class," he explained.
Firms like Wal-Mart and Carrefour are likely to see growth from increased consumer spending in Brazil, the expert mentioned, due to the increased demand spurred by the competition.
Meanwhile, if the country's team see victory, a boost from intra-tournament buying could extend into the celebrations that will accompany such an achievement.
Asset management company JP Morgan recently said that following consumer trends was a profitable way to invest, saying urbanisation and demographic shifts in a country can lead to increased spending on certain items.
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