The Brazilian economy grew by 0.2% in Q4 2024, below the expected 0.5%. Industrial output rose by 0.3%, led by construction and manufacturing, while services increased modestly. Fixed investment and government spending supported demand, but household consumption fell by 1.0%. Moreover, net trade contributed positively to GDP with rising exports and falling imports.
In the fourth quarter of 2024, the Brazilian economy recorded a modest growth of 0.2% quarter-on-quarter, a decline from the previously reported 0.7% growth in the preceding quarter, and did not meet market expectations of 0.5%. This underwhelming performance indicates economic challenges within the nation.
The industrial sector experienced a slight uptick of 0.3%, primarily fueled by notable increases in construction (2.5%), manufacturing (0.8%), and mining (0.7%). In contrast, the services sector exhibited only a minor gain of 0.1%, with transportation and storage (0.4%) and trade (0.3%) being the most significant contributors to growth.
On the demand side, growth was supported by higher fixed investment, which rose by 0.4%, alongside a 0.6% increase in government spending. However, this was significantly countered by a notable decline in household consumption, which fell by 1.0%.
Moreover, net trade had a favorable impact on GDP, characterized by a 1.3% increase in exports and a slight decrease in imports of 0.1%. This combination reflects a complicated economic backdrop, revealing the balance of growth and contraction across various sectors.
In conclusion, Brazil’s Q4 2024 economic growth of 0.2% fell short of expectations, indicating continuing economic struggles. The industrial sector showed slight advancements, but the services sector remained stagnant. Increased investment and government spending were insufficient to compensate for the significant drop in household consumption, while net trade positively impacted GDP. This scenario suggests ongoing challenges for the Brazilian economy.
Original Source: www.tradingview.com
