BRASILIA, May 18 (Reuters) – Brazil’s economic activity grew 1.3% in the first quarter from the previous three months, central bank data showed on Monday, despite \u200ca sharper-than-expected contraction in March.<\/p>\n
The IBC-Br index, a proxy for gross domestic \u200cproduct, fell 0.7% in March from February on a seasonally adjusted basis, compared with a 0.2% drop expected \u200bin a Reuters poll.<\/p>\n
All sectors tracked by the central bank declined, with services, the main driver of Brazil’s economy, falling 0.8% from the previous month.<\/p>\n
Rafael Perez, an economist at Suno Research, said March’s performance reflected a normalization after strong growth in the first two months \u200cof the year.<\/p>\n
“Part of this \u2060movement reflects a high comparison base, as well as the ongoing effects of restrictive monetary policy on economic activity. Even so, the economy \u2060remained resilient in the quarter, mainly supported by growth in services and industry,” he wrote in a note to clients.<\/p>\n
Perez projected that official GDP data, due to be released on May \u200b29, will \u200bshow growth of 1.0% in the first \u200bquarter from the previous three months.<\/p>\n
That \u200cwas faster than the fourth quarter of last year when growth was just 0.1% quarter on quarter.<\/p>\n
The central bank data is compiled from the bank’s estimates for agriculture, industry and services, as well as production-related taxes.<\/p>\n
The data for March adds to signs of an economic slowdown this year, with the central bank expected to continue its monetary easing \u200ccycle despite renewed inflationary pressures, partly driven by \u200bhigher energy prices following the U.S.-Israel conflict with Iran.<\/p>\n
The \u200bIBC-Br index rose 1.8% in the \u200b12 months through March on an unadjusted basis, and increased 3.1% \u200cfrom a year earlier.<\/p>\n
Economists surveyed weekly by \u200bthe central bank expect \u200beconomic activity to increase by 1.85% in 2026, after a 2.3% expansion last year.<\/p>\n
Policymakers have cut interest rates by 25 basis points at each of their \u200blast two meetings, bringing the \u200cbenchmark rate down to 14.50%.<\/p>\n
The bank targets 3% inflation but annual inflation \u200bin Latin America’s largest economy accelerated to 4.39% in April.<\/p>\n
(Reporting by Marcela Ayres; \u200bEditing by Chizu Nomiyama and Susan Fenton)<\/p>\n","protected":false},"excerpt":{"rendered":"BRASILIA, May 18 (Reuters) – Brazil’s economic activity grew 1.3% in the first quarter from the previous three…\n","protected":false},"author":2,"featured_media":490781,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[174],"tags":[377,79,632,31733,179,18,19,17,214161,214162],"class_list":["post-490780","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-brazil","tag-business","tag-central-bank","tag-economic-activity","tag-economy","tag-eire","tag-ie","tag-ireland","tag-rafael-perez","tag-restrictive-monetary-policy"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/116596267382242389","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/490780","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=490780"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/490780\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/490781"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=490780"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=490780"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=490780"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}