Brazilian GDP grows by 1.9% in the first quarter

The GDP for the first quarter grew 1.9%, according to data released this Thursday (1st) by the Brazilian Institute of Geography and Statistics (IBGE). The numbers were boosted by the good performance of agriculture, the resilience of the service sector and the good performance of the segments most exposed to income transfers by the federal government.

Compared to the same quarter of 2022, GDP grew by 4.0%. In the accumulated result for the last four quarters, GDP rose 3.3% compared to the four immediately previous quarters.

The good numbers of the field

Agriculture grew by 21.6% in the first quarter. “Climate problems negatively impacted agriculture and livestock last year and this year we are forecasting a record soybean crop, which represents approximately 70% of the crop in the quarter, with a growth of more than 24% in production. The soybean crop is concentrated in the first half of the year. When comparing the fourth quarter of a bad year with a good first quarter, we observe this expressive growth of Agriculture”, analyzes the coordinator of National Accounts of the IBGE, Rebeca Palis.

Still in the positive field, the service sector, which has the greatest weight in the indicator, grew by 0.6% in the period. The result was driven, mainly, by increases in the sectors of transport and financial activities, both with growth of 1.2%.

“The rise in the transport sector was influenced by both cargo and passenger transport and in financial activities, it was driven by the insurance part, as the value of premiums grew, but that of claims fell, and the sector has a gain when this happens”, points out Palis.

Industry showed stability (-0.1%) in the first quarter of 2023. “The fall in the manufacturing industry was influenced by the declines in capital goods and intermediate goods, while the activity of electricity and water, gas, sewage, activities of waste management rose 6.4%, as we are in a moment of good water conditions, without scarcity”, points out Palis.

Household consumption rises and investment falls

From the perspective of expenditure, household consumption (0.2%) and government consumption (0.3%) showed positive variations, while gross fixed capital formation, as economists call investment, (-3.4 %) registered a decrease.

The external sector contributed positively to growth, as exports of goods and services had a negative change of 0.4%, while imports of goods and services fell 7.1% compared to the fourth quarter of 2022.

Investment rate falls and savings rise

In the first quarter of 2023, the investment rate was 17.7% of GDP, below that observed in the same period of 2022 (18.4%). The savings rate was 18.1%, above the rate recorded in the same period of 2022 (17.4%).