Brazil’s Gross Domestic Product (GDP) grew by 0.9% in the second quarter of the year compared to the previous quarter, the Brazilian statistics institute IBGE reported this Friday. Despite the timid growth, the data surprised financial market analysts, who expected an advance of just 0.3%. “We are overcoming skepticism regarding GDP growth, now we have positive growth data for the country,” the number two of the Ministry of Economy, Dario Durigan, celebrated on Friday.
The Brazilian economy advanced between April and June thanks above all to industry, which grew by 0.9% due to the drive from extractive activities, construction, and electricity, water, and waste management activities. In second place is the services sector, responsible for 70% of the Brazilian GDP and which has gone 12 quarters without negative variations. It grew by 0.6%. Lastly, the powerful agricultural and livestock sector fell by 0.9%, although this setback is explained because in the first quarter there was a record growth of 21% thanks to an extraordinary harvest.
Family consumption grew by 0.9% (the biggest advance in a year), thanks to the reduction in inflation, the readjustments in income distribution programs and the improvement in the labor market, according to the statistics institute . Government spending, on the other hand, advanced by 0.7%. Exports grew 2.9% and imports of goods and services rose 4.5% compared to the first quarter of 2023.
In the annual comparison, the photo of the Brazilian economy is somewhat more colorful: compared to the same quarter of 2022, the GDP of the South American giant grew by 3.4%, and in the accumulated of the last 12 months the growth was 3.2 %. In the first semester the advance is 3.7% compared to the same period of 2022.
The Government assumes that in the months ahead the economy will not maintain the same pace as at the start of the year, but still expects to close 2023 with GDP growth of 2.5%, above what was forecast for months back.
This week positive data was also released in the labor market: in the quarter from May to July unemployment fell to 7.9%, the best data for that period since 2014. Currently, there are 8.5 million workers in Brazil. people without work, 13.8% less than a year ago.
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