Brazilian economy regains momentum and grows 1.8% in May, points out GDP Monitor – Prime Time Zone

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High occurs after retraction of 0.7% in April; despite the positive result, economic activity is still below the pre-pandemic level in February last year

José Paulo Lacerda/CNI
Performance of economic activity increased in May after falling in the previous month

The Brazilian economy grew 1.8% in May compared to April, pointed out the Monitor of Gross Domestic Product (GDP) released this Friday, 16, by Getulio Vargas Foundation (FGV). The result shows the recovery of the index after falling 0.7% in the previous month. In monetary terms, GDP has accumulated R$ 3.43 trillion since the beginning of the year. Despite the good performance, in the mobile quarter ended in May, the pace of activities was 0.9% below the same period ended in February. The FGV survey also showed that GDP is 0.7% below the pre-pandemic level in February 2020. In the year-on-year comparison, the economy grew 13.4% in May and 9.7% in the moving quarter ended in the month. According to Claudio Considera, coordinator of the GDP Monitor, the jump compared to May last year is justified by the low basis of comparison. “These results show that there is still a long way to go for a more robust recovery of the economy”, he says. Performance comes in the opposite way to Central Bank Economic Activity Index (IBC-Br), considering the preview of the GDP, which indicated a retraction of 0.43% in May.

All items that make up the survey showed positive results. Household consumption grew 10.1% in the moving quarter ended in May compared to the same period last year. The high was driven by the expressive growth of 71.6% of semi-durable products and 49.8% of durable products, returning the falls registered in April and May of last year. Gross Fixed Capital Formation (GFCF) increased 29.3% in the three months ended in May. Exports and imports also closed with a positive balance. The sale of products abroad grew 12.3% between March and May, while the purchase of imported goods registered an increase of 28.5%.