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Macroeconomic outlook report: Brazil

Second quarter of 2019

During the second quarter of 2019, the year-on-year growth rate of Brazilian GDP stood at 1.00%, after accelerating by 0.55 percentage points from the previous quarter. The year-on-year growth rate of industrial production also accelerated to -0.35%. In the labor market, the unemployment rate in the second quarter of 2019 was 12.10%, 0.70 percentage points lower than in the first quarter of 2019, and the year-on-year rate of employment growth accelerated to 2.75%. The Brazilian real depreciated against the dollar, bringing the exchange rate to 3.92 R$/USD. Finally, inflation reached 4.32% after an increase of 0.24 p.p. over the previous quarter.

Macroeconomic overview

  • The year-on-year growth rate of Brazilian GDP accelerated by 0.55 p.p. year-on-year to 1.00% in the second quarter. This performance was mainly attributed to the growth in domestic demand.
  • Industrial production registered a year-on-year rate of -0.35% in 2Q19, after an acceleration of 1.82 p.p. compared to 1Q19.
  • In the labor market, the unemployment rate fell 0.70 p.p. compared to the previous quarter, to 12.10% in 2Q19. On the other hand, the year-on-year growth rate of employment remained positive in this quarter, registering a rate of 2.75%, after an acceleration of 0.97 p.p. with respect to 1Q19.
  • The exchange rate of the real against the dollar increased with respect to the previous quarter, registering a value of 3.92 R$/US$, which implied a depreciation of 0.15 R$ per dollar (3.93%).
  • The inflation rate in Brazil increased by 0.24 p.p. compared to 1Q19, reaching 4.32%, out of the BCB target range for 2019 of 4.25% with a maximum oscillation of ±1.50 p.p.

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