June 2nd – 2023
1. Driven by agriculture, GDP grows 1.9% in first quarter of 2023
The Brazilian GDP exceeded expectations and grew 1.9% in the first quarter of the year when compared to the previous three months. According to the Brazilian Institute of Geography and Statistics (IBGE), the GDP amounted to R$2.6 trillion in the first three months of 2023.
The agriculture sector was responsible for most of the growth. The sector registered a 21.6% increase in production in the first quarter, the highest growth registered since the fourth quarter of 1996. Overall GDP grew 4% when compared to the same period of 2022.
2. Brazilians making significantly fewer cash transactions
A recently released Central Bank report shows that Brazilians are making significantly fewer cash transactions. The creation of Pix, the instant payment system developed by the Central Bank, as well as behavioral changes caused by the COVID-19 pandemic and an increase in card transactions are some of the main reasons why people are not using cash as often.
In 2020, Pix transactions amounted to R$180 million. In the following year this number reached R$9.43 billion and by 2022 it hit R$24 billion. On the other hand, people made withdrawals totaling R$3 trillion in cash from ATMs and bank branches in 2019. By 2020, this number had dropped to R$2.5 trillion before falling to R$2.1 trillion in 2021 and 2022.
3. Public debt grows to 73.2% of GDP, says Central Bank
Brazilian public debt grew in the month of April and currently represents 73.2% of the Brazilian Gross Domestic Product, up from 73% in the previous month. The net debt amounted to 57.2% of the GDP, the same level recorded in March.
The consolidated public sector registered a primary surplus of R$20.32 billion. This result exceeded experts’ predictions of a positive surplus of R$16.55 billion.
4. Lula meets with South American presidents in Brasília
Earlier this week, President Luiz Inácio Lula da Silva welcomed 11 presidents of other South American countries. The aim of the meeting was to reclaim Brazil’s standing in the region and discuss common issues such as health, infrastructure, energy, the environment, and the fight against organized crime.
Presidents Alberto Fernández (Argentina), Luís Arce (Bolivia), Gabriel Boric (Chile), Gustavo Petro (Colombia), Guillermo Lasso (Ecuador), Irfaan Ali (Guiana), Mário Abdo Benítez (Paraguay), Chan Santokhi (Suriname), Luís Lacalle Pou (Uruguay), and Nicolás Maduro (Venezuela) participated in the meeting.
Peruvian President Dina Boluarte was the only leader from the region not present. She was unable to travel due to constitutional issues and was represented by the Peruvian Prime Minister Alberto Otárola.
5. Unemployment rate remains stable at the lowest Q1 level since 2015
According to the Brazilian Institute of Geography and Statistics (IBGE), the Brazilian unemployment rate remained stable in the first quarter of 2023 at 8.5%. This is the lowest unemployment rate registered since 2015, when it was at 8.1%. Compared to the same period of 2022, when 10.5% of Brazilians were unemployed, the rate dropped 2 percentage points.
The number of people currently working dropped 0.6% when compared to the previous quarter. Overall, 98 million Brazilians are currently employed, 1.5 million (or 1.6%) more than in 2022.