GDP Monitor: economy drops by 0.4% in February

“The 0.4% decline in the GDP in February, according to the FGV’s GDP Monitor, is a consequence of the downturns in the three major economic activities (agriculture, industry, and services)" said Claudio Considio.
Economics
22 April 2019
GDP Monitor: economy drops by 0.4% in February

In the seasonally adjusted series, the FGV’s GDP Monitor shows a 0.4% drop in economic activity in February compared to January and a stagnation in the mobile quarter ended in February (quarter Dec/18-Jan-Feb/19 compared to the quarter Sep-Oct-Nov/18). In the year-on-year comparison, economic activity showed positive results, with a growth of 2.3% in the month and 1.0% in the quarter.

“The 0.4% decline in the GDP in February, according to the FGV’s GDP Monitor, is a consequence of the downturns in the three major economic activities (agriculture, industry, and services). Despite this, the interannual results show a substantial improvement in the economy, both on the supply side and on the demand side. These opposing variations show the current economic scenario in the country: the economy is still positive in relation to 2018 but is not able to react in 2019, given the great uncertainty regarding the political scenario and the necessary reforms for the economy to recover. “Apparently, the economy is on standby,” "said Claudio Considio, coordinator of FGV’s GDP Monitor.

In relation to the same month of the previous year, the activity reported a 2.3% growth in February, with decreases reported only in agriculture and livestock (-0.2%), mineral extraction (-8.8%), government consumption (-0.6%), and imports (-10.0%). The high negative variation recorded in the assessment the result of the Brumadinho disaster, which occurred in January. In the case of imports, the sharp drop was mainly due to the “base effect” of platform imports in February 2018.

The full study is available on the website.