GDP to show 0.9% growth in Q2, economists say

Driven by the recovery of the service sector and by the increase in household consumption and investments, the Brazilian economy should register growth of 0.9% in the second quarter of 2022, compared to the previous three months, according to a survey of 40 economists consulted by the agency. Bloomberg.

The GDP (Gross Domestic Product) for the second quarter will be released this Thursday (1st) at 9 am by the IBGE (Brazilian Institute of Geography and Statistics). In the first quarter, growth was 1% on the same basis of comparison.

The period from April to June was marked by strong growth in services, while industry and retail had weak results. Other factors that contributed to the growth in the period were the extraordinary withdrawal of R$ 1,000 from the FGTS and the anticipation of the first installment of the 13th salary for INSS beneficiaries.

Of the 40 estimates collected by Bloomberg, 39 are in the range of 0.6% (Capital Economics) to 1.4% (Bank C6). There is also a 2.9% share from Petros, a Petrobras pension fund.

Economist Alexsandro Barbosa, from Austin Rating, expects growth of 0.7% in the quarter, closer to the bottom of projections. He claims to see a continuity of the recovery process post 2020.

“It may be a little slower than in the first quarter, but very close to what was already happening, supported mainly by the service sector, which continues to carry a piano on its back after having suffered a lot”, says Barbosa.

For him, the scenario from now on is a loss of breath, but with new government incentives —increase in Auxílio Brasil, tax cuts and reduction in the price of gasoline— able to avoid a scenario of a quarterly drop in GDP in the second half of the year.

The Austin Rating economist says, however, that there will be a “see-saw effect”, postponing this loss of breath to 2023, when the international scenario and high interest rates will also contribute more to lower growth in Brazil. He projects growth of 2% this year and only 0.1% the next.

Jason Vieira, chief economist at Infinity Asset Management, projects expansion of 1.2% in the quarter, above the market median.

“At the beginning of the year, we were already talking about growth, not recession, and the reopening process ended up being more expressive than expected. The perception is that there is already a relatively consistent growth”, he says.

He says he expects a weaker third quarter, due to seasonal issues, but believes that the government’s package of goodies will help growth and that the announcement of new stimulus measures until the elections cannot be ruled out. Vieira also assesses that investment is recovering, with numbers that should be better in the coming quarters.

FGV’s GDP Monitor showed growth of 1.1% in the quarter, also highlighting the good performance expected for household consumption (1.8%) and investments (4%).