Brazil’s Economy Sees Subdued Growth in Q4 2024, Missing Expectations

Brazil’s economy grew by 0.2% in Q4 2024, below the 0.5% forecast. Industrial output increased by 0.3%, mainly due to construction and manufacturing. Investment and government spending helped balance a decline in household consumption, while net trade positively influenced GDP with rising exports.

In the final quarter of 2024, Brazil’s economy reported subdued growth, with a 0.2% increase quarter-on-quarter. This figure followed a previously revised growth rate of 0.7% in the preceding quarter and did not meet market expectations of 0.5%.

Industrial output managed a rise of 0.3%, primarily propelled by the construction sector, which grew by 2.5%. Additionally, manufacturing and mining expanded by 0.8% and 0.7%, respectively. In contrast, the service sector demonstrated minimal growth at 0.1%, with contributions from transportation and storage at 0.4%, along with trade at 0.3%.

On the demand side, Brazil experienced a boost in fixed investment, which increased by 0.4%, along with government spending rising by 0.6%. These positive trends, however, could not completely counterbalance a significant decline in household consumption, which fell by 1.0%.

Moreover, net trade benefited GDP with exports experiencing a 1.3% uptick, while imports decreased slightly by 0.1%. This interplay of investments and trade highlighted the mixed economic performance during this quarter.

In summary, Brazil’s economy experienced limited growth of 0.2% in Q4 2024, falling short of expectations. Industrial gains were offset by declining household consumption, whereas net trade provided some support through increased exports. The overall economic landscape reflected a combination of positive investments and a challenging domestic consumption environment.

Original Source: www.tradingview.com