Brazil Q4 GDP Growth Slows to 0.1% QoQ

The Brazilian economy advanced 0.1 percent on quarter in the fourth quarter of 2018, slowing from a downwardly revised 0.5 percent expansion in the previous period and below market expectations of 0.2 percent. The slowdown was mainly due to a decline in government spending and gross fixed capital formation.

On the expenditure side, government consumption shrank 0.3 percent (+0.3 percent in Q3) and gross fixed capital formation dropped the most sonce Q3 of 2016 (-2.5 percent compared to +5.5 percent). On the other hand, consumer spending increased 0.4 percent, easing from a 0.5 percent in the third quarter of 2018. Meantime, exports rose 3.6 percent (6.3 percent in Q3) while imports fell 6.6 percent (9.4 percent in Q3).

On the production side, the industrial sector contracted 0.3 percent, after expanding 0.3 percent in the previous quarter. Manufacturing was down 1 percent  (+0.6 percent in Q3) and slower growth was reported for construction (0.1 percent compared to 0.4 percent) and mining (1.9 percent compared to 0.8 percent). In contrast, utilities output rebounded 3.9 percent (-2 percent in Q3). 

The services sector advanced 0.2 percent, after a 0.3 percent rise in the prior period brought down by decline in internal trade (-0.1 percent compared to 1.0 percent); transportation (-0.3 percent compared to 1.8 percent) and financial services (-0.5 percent compared to a flat reading). Additionally, real estate activities went up less (0.7 percent compared to 1 percent). 

Finally, agriculture grew 0.2 percent, following a 0.8 percent gain in the prior period.

Year-on-year, the gross domestic product expanded 1.1 percent easing from a 1.3 percent growth in the previous period and missing market consensus of 1.3 percent. 

Considering full 2018, the economy grew 1.1 percent, the same as in 2017.

Brazil Q4 GDP Growth Slows to 0.1% QoQ

IBGE | Stefanie Moya |
2/28/2019 1:01:45 PM