The Brazilian economy grew by 1 percent in Q1 2022, per the country’s latest GDP report. And while in line with the median forecast of 82 consultancies surveyed by finance newspaper Valor, the numbers fell short of the 1.5 percent tipped by respected think tank FGV-Ibre and the 1.4-percent expected by brokerage firm XP.
Quarterly performance was almost entirely underpinned by growth in the services sector, which grew 1 percent. Services make up around 70 percent of the Brazilian economy. Meanwhile, the industrial sector expanded by just 0.1 percent.
The agribusiness sector — which anchored growth in recent years — contracted 0.9 percent as weather conditions caused hiccups to the soy harvest and inputs became more expensive.
Conditions will remain daunting for farmers, as the sector expects production costs to hit an all-time high during the next harvest — a byproduct of the war in Ukraine and Chinese deceleration.
In year-on-year terms, Q1 GDP grew 1.7 percent. Official statistics agency IBGE also adjusted its figures for Q4 2021: from 0.5 percent quarterly growth to 0.7 percent.
“The result is positive in relation to what was expected a month ago, but a little worse than what the market was expecting yesterday,” says Luciano...
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