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Macroeconomic outlook report: Brazil

Fourth quarter of 2017

During the fourth quarter of 2017, the y/y growth rate of Brazilian GDP stood at 2.22%, after registering an acceleration of 0.78 p.p. with respect to the previous quarter. The y/y growth rate of industrial production reached 5.49% in this period. With regard to the labor market, the unemployment rate decreased by 0.60 p.p. to 11.80%. On the other hand, the y/y growth rate of employment accelerated, although continued in a negative growth, of -0.41%. The Brazilian real depreciated with respect to the dollar in this quarter, reaching 3.25 R$/USD. Inflation stood at 2.82% in 4Q17, after increasing by 0.25 p.p. with respect to the previous quarter.

Macroeconomic overview

  • Brazilian GDP y/y growth rate experienced an increase of 0.78 p.p. during the fourth quarter of the year with respect to the previous one, up to a rate of 2.22%. The main driver of this behavior was the greater y/y growth registered by private consumption and net exports in comparison to the third quarter, of 0.42 p.p. to 3.27% and 3.30 p.p. up to 5.20%, respectively.
  • Industrial production stood at 5.49% in 4Q17, after an acceleration of 2.74 p.p. when compared to the previous quarter.
  • Regarding the labor market, the unemployment rate stood at 11.80% in the fourth quarter of 2017, which represents a decrease of 0.60 p.p. when compared to the previous quarter. The employment y/y growth rate registered in 4Q17 was -0.41%, an acceleration of 0.92 p.p. when compared to the previous quarter.
  • The exchange rate of the Brazilian real in this period was 3.25 R$/USD, which represented a depreciation of 2.84% when compared to the previous quarter.
  • Inflation stood at 2.82% in 4Q17, after an increase of 0.25 p.p. when compared to 3Q17. That increase broke the downward trend after several months of consecutive declines.

For more information access the executive document in pdf (avalaible in Spanish and Portuguese).