Having shown signs of slowing in the second half of last year, Brazilian credit growth appears to have picked up again in recent months. But while this should give a boost to overall GDP growth in the first quarter of this year, the bigger picture is that the pace of lending growth seen over the past couple of years has been unsustainable. A further rapid expansion in bank lending from here on would be a major concern and is something that merits close attention over the next 6-12m.
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