GDP Rate Change: How Are We Doing? We are zeroed, but at least we are not falling!!! Families are consuming a little more, and it means a higher income!! The service sector, the largest in the share economy, showed a certain recovery in contrast to the first quarter, when agriculture, which represents little, held the GDP up. In August 2017, car sales also recorded the biggest sale of the year!
The investment rate on the GDP is at 15.5% in the second quarter of 2017, and we need at least 20%, when the ideal rate is 25%, that is, recovery will be very slow, perhaps a decade ahead.
The Gross Domestic Product (GDP) rate changed 0.2% when comparing the second quarter to the first quarter of 2017, in the series with a seasonal adjustment. In comparison with the second quarter of 2016, the GDP rate changed by 0.3%. In the accumulated of a four-quarter period, the GDP fell by 1.4% in relation to the immediately preceding four quarters. In the first half of 2017, the GDP had zero change against the first half of 2016. In current amounts, the GDP in the second quarter of 2017 reached R$ 1,639 trillion.
Household spending stands out and grows in relation to the 1st quarter
The GDP rate changed 0.2% when comparing the second quarter against the first quarter of 2017 in the series with seasonal adjustment. Agriculture & Livestock registered zero change (0.0%), Industry fell 0.5% and Services grew 0.6%.
In the Industry, there was a 2.0% fall in the construction sector and 1.3% in the electricity and gas, water, sewage and urban cleaning activities. Mineral extraction changed 0.4% and the manufacturing industry remained practically flat (0.1%).
In the Services sector, there was a positive result: commerce (1.9%), real estate activities and other services (0.8%) and transport, warehousing and mail (0.6%). Information services fell by 2.0% and the administrative, health and public education (-0.3%), and the financial and insurance intermediation activities (-0.2%) registered negative changes.
From the point of view of expenses, Household Spending grew again after nine quarters, with an expansion of 1.4%. On the other hand, Government Spending (-0.9%) and Gross Fixed Capital Formation (-0.7%) fell. In the external sector, Exports of Goods and Services recorded a positive change of 0.5%, while Imports of Goods and Services fell 3.5% in relation to the first quarter of 2017.
In comparison with the second quarter of 2016, Agriculture & Livestock grows and industry and services declines.
When compared to the same period of the previous year, the GDP showed a positive change rate of 0.3% in the second quarter of 2017, after 12 consecutive quarters with negative results. The Added Value to basic prices had a positive change rate of 0.3%. Taxes on Net Products of Subsidies remained practically flat (0.1%).
Among the activities, Agriculture & Livestock grew 14.9% in relation to the second quarter of 2016. This result can be explained mainly by the performance of some products that have a relevant harvest period in the second quarter, and for the productivity, according to the Systematic Survey of Agricultural Production (LSPA) in August. Except for coffee, which showed a 7.0% decline in the annual production estimates, the other crops showed a growth in the annual production estimate and productivity gain: maize (56.1%), soybean (19.7%) and rice (16.3%).
The Industry dropped by 2.1%. In this context, the manufacturing industry fell by 1.0%, influenced mainly by the decline in production of transport equipment (except motor vehicles), machinery, electrical appliances and materials, oil products and biofuels, and food and beverages.
Construction had also a reduction in the volume of value added: -7.0%. Mineral extraction expanded by 5.9%, driven by the growth of oil and natural gas extraction and ferrous minerals. The activity of electricity and gas, water, sewage and urban cleaning, in turn, recorded a negative variation of 0.5%.
Services added value showed a negative rate change of 0.3%, especially for the 2.5% contraction in information services – this activity includes telecommunications, TV, radio and cinema activities, newspapers, books and magazines issues, IT and other services related to information and communication technologies (ICTs) – and a drive back of 2.1% for financial intermediation and insurance. The activities of administration, health and public education (-1.3%) and transport, storage and mail (-0.5%) also registered drops.
On the other hand, trade (wholesale and retail) and real estate activities grew 0.9%, followed by other services, which registered a positive variation of 0.3%.
After nine falls, household spending grows again in relation to the 2nd quarter of 2016
After nine consecutive quarters of decline, Household Spending is back to positive results: a growth rate of 0.7% compared to the same period in 2016. This result was influenced by the evolution of some macroeconomic indicators during the quarter, such as the deceleration of inflation, reduction of the basic interest rate and the growth, in real terms, of the total payroll.
The Gross Formation of Fixed Capital had a contraction of 6.5% in the second quarter of 2017, the 13th consecutive contraction. This decline is mainly due to the fall in imports of capital goods and to the negative performance of the construction sector in this period. The Government Consumption Expenditure, in turn, contracted by 2.4%.
In the external sector, Exports of Goods and Services showed a rate growth of 2.5%, while Imports of Goods and Services went through a contraction of 3.3% in the second quarter of 2017. Among exports of goods, those that registered the greatest increases were motor vehicles, oil and natural gas, agricultural products and paper and pulp. In relation to import of goods, the most significant falls occurred in machinery and equipment, transport equipment (except motor vehicles), metal minerals, machinery, electrical equipment and materials, and metal products.
GDP has zero change (0.0%) in the first half
In the first half of 2017, GDP had zero change compared to the same period of 2016, after falling 2.7% in the second half of 2016. On this basis of comparison, the positive performance of the Agriculture & Livestock sector (15.0%) stands out. Industry and Services fell by 1.6% and 1.0%, respectively.
In the analysis of the domestic demand, considering the half-yearly comparison, we highlight a 5.1% decline in the Gross Fixed Capital Formation. Household Spending fell by 0.6%, while Government Spending declined by 1.9%. Regarding the external sector, Imports of Goods and Services grew by 2.9%, while Exports of Goods and Services grew by 2.2%.
| BENCHMARK PERIOD | INDICATORS | ||||||
| GDP | AGRIC & LIVESTOCK | INDUS | SERV | FBCF | FAM. SPEND | GOV. SPEND | |
| Quarter / immediate previous Quarter (with seasonal adjustment) |
0,2% | 0,0% | -0,5% | 0,6% | -0,7% | 1,4% | -0,9% |
| Quarter / same quarter of the previous year (w/o seasonal adjustment) |
0,3% | 14,9% | -2,1% | -0,3% | -6,5% | 0,7% | -2,4% |
| Accumulated in 4 quarters / same period of previous year (w/o seasonal adjustment) | -1,4% | 6,2% | -2,1% | -1,7% | -6,1% | -1,9% | -1,2% |
| Current Values in the quarter (R$ billions) | 1.639,3 | 82,4 | 298,7 | 1.041,7 | 253,9 | 1.023,3 | 336,1 |
| INVESTMENT RATE (FBCF/PIB) in the 2nd quarter of 2017 = 15.5% | |||||||
| SAVINGS ACCOUNT RATE (POUP/PIB) in the 2nd quarter of 2017 = 15.8% | |||||||
The following table summarizes the main GDP results in the last five quarters:
| Main GDP results at market prices from 2nd quarter of 2016 to 2nd quarter of 2017 | |||||
| Rates (%) | 2016.II | 2016.III | 2016.IV | 2017.I | 2017.II |
| Accumulated during the year / same period of the previous year | -4,5 | -4,0 | -3,6 | -0,4 | 0,0 |
| Last four quarters / immediate previous four quarters | -4,8 | -4,4 | -3,6 | -2,3 | -1,4 |
| Quarter / same quarter of previous year | -3,6 | -2,9 | -2,5 | -0,4 | 0,3 |
| Quarter / immediate previous quarter (with seasonal adjustment) | -0,4 | -0,6 | -0,5 | 1,0 | 0,2 |
| Source: IBGE, Diretoria de Pesquisas, Coordenação de Contas Nacionais | |||||
Investment rate stands at 15.5% of the GDP in the 2nd quarter
Gross Domestic Product in the second quarter of 2017 totaled R$ 1.639 trillion, of which R$ 1.422 trillion were related to the Value Added at basic prices, and R$ 216.5 billion to Taxes on net Products of Subsidies.
The investment rate in the second quarter of 2017 was 15.5% of the GDP, down from the same period of last year (16.7%). Savings rate was 15.8% in the second quarter of 2017 (compared to 15.6% in the same period in 2016).
Source (Portuguese): Agência de Notícias IBGE
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