Brazil GDP Growth Below Forecasts in Q4



The Brazilian economy advanced 0.1 percent on quarter in the last three months of 2017, following an upwardly revised 0.2 percent expansion in the previous period and well below market expectations of a 0.4 percent rise. It is the lowest growth rate in four quarters after a 2-year recession in 2017. Considering full 2017, the economy expanded 1 percent, following a 3.5 percent contraction in both 2016 and 2015.

Household spending slowed sharply (0.1 percent compared to 1.1 percent in Q3). Also, exports shrank 0.9 percent, following a 3.3 percent jump in Q3, marking the biggest drop in five quarters. Imports rose at a softer 1.6 percent after a 6.5 percent surge in Q3. On the other hand, gross fixed capital formation went up 2 percent after a 1.8 percent rise in Q3. It is the biggest increase since the second quarter of 2013. Also, government expenditure went up 0.2 percent, the first increase in seven quarters.

Year-on-year, the economy advanced 2.1 percent, higher than 1.4 percent in Q3 and the strongest annual growth since the first quarter of 2014.

Considering full 2017, household spending went up 1 percent (-4.3 percent in 2016), the first increase since 2014; exports rose 5.2 percent (1.9 percent in 2016), the most since 2015, mainly boosted by products of agriculture, oil and gas, automotive industry and machinery and equipment; imports grew 5 percent (-10.2 percent in 2016), the first increase in 4 years amid purchases of petroleum refining, electronic materials and communication and clothing. On the other hand, gross fixed capital formation slumped for the fourth year (-1.8 percent compared to -10.3 percent in 2016), dragged down by a 5.6 percent decline in construction that offset a 3 percent gain in machinery and equipment. Public expenditure declined for the third consecutive year (-0.6 percent compared to -0.1 percent in 2016).

Brazil GDP Growth Below Forecasts in Q4


IBGE | Joana Taborda | joana.taborda@tradingeconomics.com
3/1/2018 12:42:58 PM