Brazil Back to Black and Out of Recession, Say Authorities

Brazil announced today, September 11, that 2009 second quarter real gross domestic product – the output of goods and services adjusted for inflation – increased 1.9 percent from the first quarter of 2009, according to data released by the Brazilian Institute of Geography and Statistics (IBGE). 

This marks a return to growth from the contraction in the first quarter of 2009 – when GDP fell 1.0 percent.

"With this data, it is clear that Brazil's economy has rebounded from the global financial crisis," said Brazilian Finance Minister Guido Mantega. 

"This performance defies analysts' previous forecasts and bodes well for 2010. Based on positive trends in industry, services and employment rates, we expect continued growth in the Brazilian economy next year."

The president of the Central Bank, Henrique Meirelles, told reporters that the result of the GDP growth is "excellent news" for the Brazilian people and evidence that the country got out not only of the recession, but also of the international financial crisis.

"The GDP growth results reported by the IBGE for the second quarter of 2009 are, without any doubt, excellent news for the Brazilian people. This makes it clear that Brazil is already out of the recession. Brazil went out of the crisis before and with a stronger growth than most countries. Preliminary data show that Brazil is one of the leaders, if not the leader, in growth in its way out of the recession", said Meirelles. He added that the country is already in a "sustainable growth trajectory."

Brazil's growth was boosted by an increase of 3.2 percent in domestic demand, in comparison with the same period of 2008, and an increase of 2.2 percent in public administration consumption, over the same period. These growth trends reflect the quick effect of the government's countercyclical measures.

The increase in real GDP in the second quarter of 2009 in the seasonally adjusted series primarily reflects an increase in industrial activity of 2.1 percent. Agriculture registered a decrease of 0.1 percent and services increased by 1.2 percent over the same period.

SUMMARY TABLE – Main results of GDP at market prices from Q2 2008 to Q2 2009

  Rates (%)                 Q2 2008   Q3 2008   Q4 2008    Q1 2009   Q2 2009

  Accumulated in the
  year/same period as
  in the previous year        6.2       6.4       5.1      (-)1.8    (-)1.5

  Last four quarters/four
  immediately previous
  quarters                    6.0       6.3       5.1         3.1       1.3

  Quarter/same quarter as
  in the previous year        6.2       6.8       1.3      (-)1.8    (-)1.2

  Quarter/immediately
  previous quarter
  (seasonally adjusted)       1.5       1.3    (-)3.4      (-)1.0       1.9

  Source: Brazilian Institute of Geography and Statistics (IBGE).