The Brazilian economy maintains its growth rate with an increase of 1.2% of GDP

The Brazilian economy maintains its growth rate with an increase of 1.2% of GDP

The Brazilian economy advanced by 1.2% in the second quarter of 2022, driven by the services and industry sector, and maintained practically the same momentum registered in the first three months of the year, when the country’s GDP grew by 1.1% , according to data released this Thursday by the Government.

In the comparison with the same period last year, Brazil’s gross domestic product (GDP) grew by 3.2%, while that accumulated in the first half of 2022 grew by 2.5%, only one tenth below that the accumulated of the last twelve months (2.6%).

This is the fourth consecutive positive result of the indicator, although experts announce a slowdown for the second half.

The advance of the Brazilian economy in the second quarter was driven by the services sector, responsible for 70% of the country’s GDP, and by industry.

Services grew by 1.3% in the period, mainly due to the strong dynamics of restaurants, hotels and bars, services that already see a stronger reactivation after the stoppage they suffered due to the pandemic.

The industry registered the highest advance of the period (2.2%) thanks to the activities related to public services and waste management, construction and mining extraction.

The agricultural sector, which had been weighed down, recovered this quarter and advanced 0.5% after having fallen 0.9% in the first three months of the year and falling 2.5% in the same period of 2021.

For the Government, the advance of the Brazilian power “maintains the growth trajectory of 2022” and the result of the second semester “confirms the sustainability of the country’s economic activity,” according to a note released by the Ministry of Economy.

The growth rate, for the ministry, reflects a “faster” recovery than that of other countries, including “some emerging”, since among the G-20 countries, “Brazil presented the second best result.”

And it is that the economic result registered in the second quarter of the year was higher than expected by a good part of the market analysts, who estimated an average advance of 0.9%.

However, experts project that the growth achieved in the first six months of the year will define the progress of the Brazilian economy in 2022.

This is because, according to economists, the GDP of the South American power will slow down in the second semester due to different factors, such as high interest rates, at their highest level in five years, the international crisis and the uncertainty generated by the presidential elections. October.

To try to contain inflation, which stands at 10.07% year-on-year, the Central Bank raised the basic interest rate to 13.75% per year.

To this is added the uncertainty generated by the war in Ukraine and the electoral situation in Brazil in the face of the elections on October 2, under a polarized campaign between former president Luiz Inácio Lula da Silva and Jair Bolsonaro, who is seeking re-election.

Just a month before the presidential elections, Lula remains the top favorite in the electoral polls, with close to 45% of the intention to vote, followed by the far-right leader who adds around 30%, according to the polls.

The growth of the Brazilian economy forecast for this year is 2%, and if confirmed, it will show a slowdown compared to the strong expansion registered in 2021.

As a consequence of the crisis generated by the pandemic, the Brazilian economy shrank by 3.9% in 2020, its biggest drop in more than two decades, but, with the reactivation of activities, it reacted last year, when the GDP grew 4.6%, its biggest rise in a decade.

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