In a scenario of strong inflation and rising interest rates, the GDP (Gross Domestic Product) of several countries had a weaker performance in the first quarter of 2022 compared to the last three months of 2021, according to data collected by the OECD (Organization for the Economic Cooperation and Development) in a list of 28 nations.
This Thursday (2), the IBGE (Brazilian Institute of Geography and Statistics) announced that Brazil’s GDP in the first quarter grew by 1%, at a similar level to that of Mexico (1.2%) and Colombia (1.0 %).
In the external sector, exports of goods and services from Brazil grew by 5.0%, while imports fell by 4.6% compared to the fourth quarter of 2021.
In the same period, Portuguese GDP increased by 2.6%. Then come three other European countries: Austria, with growth of 2.5% in the first quarter, Hungary (2.1%) and Latvia (2.1%).
On average, the GDP of OECD countries grew by 0.1% in the first quarter of 2022 compared to the previous one. The result represents a sharp slowdown from the 1.2% gain recorded in the final three months of 2021.
Three countries in the group had a negative performance: the United States (-0.4%), Italy (-0.2%) and Japan (-0.2%).
Analysts point out that the international situation is worrying and was deeply worsened by the War in Ukraine, which began on February 20, and new interruptions in supply chains also weighed, still due to the pandemic.
The conflict in eastern Europe caused food and energy prices to rise, which also hurt household incomes. Central banks in different countries, in turn, raised interest rates in response.
With annualized inflation of 7.4% in April, eurozone prices soared, while citizens’ incomes failed to keep up. This movement shakes living standards and limits consumption and post-pandemic recovery.
In emerging countries, analysts expect supply crises and an increase in the number of people experiencing food insecurity.
In the period, it also pulled down the performance of the economies of the United States and Japan.
In the US case, looking ahead, accelerating inflation and diminishing fiscal support point to a more moderate growth in spending for the rest of the year. In addition, higher interest rates may, at some point, lead companies to cut investments.
Other potential headwinds for the US economy include the negative effects of the Ukrainian War, deteriorating growth prospects in Europe, raw material shortages and persistent supply chain bottlenecks.
Robin Brooks, chief economist at the Institute of International Finance, told the Financial Times that the confluence of shocks indicates that the world economy is already in trouble. “We are living through another period of recession fear, except this time the risk could be real.”
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