Brazil’s economy is showing signs of progress, with the country expected to become the 8th largest economy in the world according to the IMF. The Gross Domestic Product (GDP) of Brazil grew by 0.8% in the first quarter of 2024 compared to the last quarter of 2023, and by 2.5% year-on-year after a slight contraction in the previous quarter.
The main drivers behind this economic recovery were the 11.3% increase in agriculture, followed by a 1.4% growth in services, while industrial output showed a slight decline of -0.1%. Investments increased by 4.1% and household consumption rose by 1.5% due to factors such as an improving labor market, falling interest rates and inflation, and government subsidies for those in need.
President Luiz Inácio Lula da Silva expressed optimism about the country’s economic performance, stating that the GDP growth in the first quarter was indicative of being on the right track. He also mentioned that Brazil is projected to move up to the 8th position in the world GDP rankings according to the IMF.
However, there may be challenges ahead for Brazil’s economy, particularly due to the floods affecting the southern State of Rio Grande do Sul, which contributes significantly to the country’s GDP. This could impact the economic trajectory in the coming months.