BRASILIA (Reuters) – Brazil’s economy shrank in the second quarter by the most on record as anti-coronavirus lockdown measures slammed activity in almost every sector, dragging Latin America’s largest economy back to the size it was in 2009.
The pandemic triggered a 9.7% fall in gross domestic product from the prior quarter, government statistics agency IBGE said on Tuesday, and an 11.4% decline compared with the same period last year.
The magnitude of the slump in activity across the economy in the second quarter was huge: industry fell 12.3%, services 9.7%, fixed investment 15.4%, household consumption 12.5% and government spending 8.8%.
Household consumption, which accounts for two-thirds of all economic activity in Brazil, was a particularly heavy drag, IBGE said.
Only agriculture expanded in the quarter, by 0.4%.
Carlos Kawall, director at ASA Bank and a former treasury secretary, said Brazil’s economy is unlikely to grow back to where it was last year until 2023.
“It’s a horrible period for the economy. From the standpoint of the economy, social implications, and unemployment, it has been a disaster,” he said, adding that he is revising down his 2021 growth forecast to 2.1% from 2.7% due to uncertainty about the labor market and consumption outlook.
The economy ministry was more upbeat, noting that many of Brazil’s emerging market peers posted larger GDP contractions in the second quarter and that the outlook for this year has been brightening in recent weeks.
“High frequency indicators show that activity continues to recover. However, for the rebound to be consistent, it is important to continue the structural reform and fiscal consolidation agenda,” it said in a statement.
The government’s current forecast is for a 4.7% contraction in GDP this year, which would still be the largest annual fall since records began in 1900. The average forecast in a weekly central bank survey of economists is for a 5.3% decline.
The downturn in the April-June period was steeper than economists had expected. The median estimates in a Reuters poll of economists were for a 9.4% fall on the quarter and an annual decline of 10.7%.
The value of Brazil’s GDP at current prices was 1.65 trillion reais ($306 billion) in the second quarter, IBGE said.
IBGE also revised the January-March figures to a 2.5% fall in GDP from the initial estimate of a 1.5% decline.
($1 = 5.40 reais)
(Reporting by Jamie McGeever; Editing by Catherine Evans and Chizu Nomiyama)
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
