FGV’s GDP Monitor points to 0.1% growth in Brazil’s economic activity in November, compared to October, in seasonally adjusted terms. Year-over-year, November’s economic growth was 2.0%. On an annualized quarterly basis, the economy grew 2.6% in the three months ending in November.

“Brazil’s economic growth of 0.1% in November is explained by the positive performance of agriculture and industry. In turn, the service sector, which has shown a decelerating trend since mid-2022, shrank in November, after six consecutive months of positive rates. It is important to highlight the performance of this sector, as it has been responsible for around 80% of GDP growth so far in 2022. High interest rates combined with the high level of household debt contributed to this slowdown in services,” explains Juliana Trece, the coordinator of the GDP Monitor.

Disaggregated analysis of demand components

Disaggregated graphic analysis of demand components was based on the annualized quarterly series, as it is less volatile than the monthly and seasonally adjusted data, allowing a better understanding of the trajectory of components.

Household consumption

Household consumption grew 4.4% in the three months to November. As shown in Graph 3, consumption of services continues to be the main driver of this growth, although at a lower level than previously observed. This deceleration in the pace of growth was observed in all components of consumption, although only the consumption of semi-durable products actually declined in the three-month period (-9.6%).

Gross fixed capital formation

Gross fixed capital formation expanded 5.6% in the three months to November. All components grew, especially machinery and equipment, which contributed around 70% of growth. As in the four previous three-month periods, strong growth in machinery and equipment imports explains the evolution of the machinery and equipment segment.

Exports

Exports of goods and services grew 15.1% in the three months to November. As shown in Graph 5, all segments contributed positively to this performance. Exports of agricultural products were the main highlight, accounting for approximately 30% of total export growth.

Imports

Imports of goods and services grew 6.5% in the three months to November. Although positive, this represents a reduction in the pace of growth observed since mid-2022. Imports of intermediate goods were the main cause of this slowdown, reducing growth from 9.4% in the three months to October to 3.7% in the three months to November.

GDP

It is estimated that Brazil’s GDP amounted to R$8.990281 trillion between January and November 2022, in current prices.

Investment rate

Graph 7 of the press release highlights the average investment rates in two lines: the orange line (on top) shows the average monthly investment rates since January 2000 (18.0%), while the gray line (below) shows the average monthly investment rates since January 2015 (16.6%). It can be seen that the investment rate in November 2022 was 19.9%, in the series at current values. Thus, the investment rate was above the average monthly rate seen since 2000 and also above the average rate since the first quarter of 2015.

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