Brazilian economy grows 1% in the 1st quarter of 2022 with the help of services, says IBGE

The Brazilian economy advanced 1% in the first quarter of 2022 compared to the last quarter of last year, informed the IBGE (Brazilian Institute of Geography and Statistics) this Thursday (2).

In relation to the same quarter of last year, the increase in GDP (Gross Domestic Product) was 1.7% and, in the accumulated in the four quarters, 4.7%.

The services sector was the main responsible for the growth, as they represent 70% of the country’s GDP (Gross Domestic Product), with emphasis on services provided to families, such as accommodation and food. “Many of these activities are face-to-face and had repressed demand during the pandemic”, explains the coordinator of national accounts at IBGE, Rebeca Palis, in a note.

Financial market expectations were around an increase of 1.2% over the immediately previous period and 1.8% in the annual comparison.

The result for the quarter is the third positive, after a decline of 0.2% in the second quarter of 2021, and is 1.6% above the level of the fourth quarter of 2019, a period before the coronavirus pandemic. The number is 1.7% below the highest point of economic activity in the country, recorded in the first quarter of 2014, highlights the IBGE.

In the fourth quarter, GDP increased by 0.5%. In 2021, the indicator showed an increase of 4.6% after a fall of 4.1% in 2020.

GDP is the sum of all goods and services produced in the country in a given period.

It is worth mentioning that, despite the positive result in the first period of the year, experts expect that economic activity will continue to show a deceleration in the face of the global scenario of pressured inflation and rising interest rates.

As an extra challenge, Brazil still counts on the deterioration of domestic financial conditions, as mentioned by the Brazilian Institute of Economics of Fundação Getulio Vargas (FGV-Ibre) in a note.

*In update