The Brazilian economy grew 0.9% in the second quarter of this year compared to the previous quarter, according to data released this Friday (31) by the Brazilian Institute of Geography and Statistics (IBGE). In twelve months, growth was 3.2%.
According to the Ministry of Planning, the result exceeded expectations. The agency cited that financial market economists estimated growth of just 0.3% in the quarter.
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The index is calculated based on the Gross Domestic Product (GDP) of the country. GDP is the sum of all wealth produced in an economy during a given period. In the second quarter, it totaled R$ 2.651 trillion.
This wealth has been growing for eight quarters in the country. The last retreat was recorded in the second quarter of 2021, still during the government of former President Jair Bolsonaro (PL). In the first six months of President Luiz Inácio Lula da Silva’s (PT) administration, GDP has already grown by 3.7%.
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In the second quarter of 2023, industry drove economic growth, with a 0.9% increase in production. The service sector grew by 0.6% and came next.
“The GDP shows the good performance of the industrial sector, influenced mainly by the increase in the extractive industry, and the continued growth of the services sector for the 12th consecutive quarter and presents an average annualized rate of 4.2% in this period”, commented the Ministry of Planning, in a note.
Agriculture, which had grown 21.6% in the first quarter, now fell 0.9%. The drop in production in the sector slowed down the growth of the economy as a whole. In the first quarter, national GDP had grown by 1.8% – adjusted result.
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In the second quarter of 2023, the investment rate was 17.2% of GDP, below that observed in the same period of 2022 (18.3%). The savings rate increased from 18.4% in the second quarter of 2022 to 16.9%.
Household consumption grew by 0.9% in the second quarter and government spending, by 0.7%. The so-called gross fixed capital formation – an indicator of how much companies invested in machinery and equipment – remained stable in relation to the immediately previous quarter.
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“Demand components show growth, highlighting the strength of household consumption, which has already grown by 1.7% compared to the end of last year, and the strong performance of exports, which increased by more than 3.0% in this period,” added Planning.
According to Planning, considering the results from the beginning of the year, the Brazilian GDP should close the year with a growth of 3%, above what the government itself predicted. “If there is no increase in activity for the other quarters of the second half of 2023, the Brazilian GDP will grow by 3%, surpassing the current market projection which is at 2.3%”.
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Accumulated in 12 months
The accumulated GDP in the four quarters ending in June 2023 grew 3.2% in relation to the four immediately previous quarters. The sectors that grew the most were agriculture (11.2%), followed by industry (2.2%) and services (3.3%).
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Gross fixed capital formation grew 1.7%. Household consumption and government expenditure increased by 3.9% and 1.4%, respectively.
Editing: Rodrigo Chagas