Brazil’s economy is expected to have regained momentum in the first quarter of 2025, driven by a surge in household spending and private investment, according to a Reuters poll of economists conducted from May 21–26.
Buenos Aires, May 29, 2025 (Reuters) — Brazil’s economy is expected to have regained momentum in the first quarter of 2025, driven by a surge in household spending and private investment, according to a Reuters poll of economists conducted from May 21–26.
After slowing to 0.2% quarterly growth in Q4 2024, Brazil’s gross domestic product (GDP) likely expanded by 1.4% in the January–March period, according to the median forecast of 19 analysts. On an annual basis, the economy is projected to have grown 3.2%.
The rebound reflects a resilient labor market, government credit incentives, and strong agricultural output, particularly in soybean exports to China, which buys roughly 70% of its soy imports from Brazil.
“The resilience of the labor market and the government’s incentive measures during the period continued to drive greater consumption,” wrote economists at Kinitro Capital.
Key Growth Drivers
Household Consumption: Boosted by a strong job market and new payroll-deductible loan schemes, personal spending increased despite persistently high interest rates.
Capital Expenditure: Investment in equipment and infrastructure also contributed positively in Q1.
Agriculture: A bumper soybean crop underpinned growth in the supply sector, with China remaining Brazil’s primary export destination for the oilseed.
Weighing Factors
While domestic demand surged, the external sector weighed on GDP, with imports growing faster than exports. Industrial output and services expanded, though both underperformed expectations due to the drag of elevated borrowing costs.
Brazil’s benchmark interest rate remains near a 20-year high, a consequence of the central bank’s efforts to curb inflation. This hawkish monetary stance is expected to restrain economic expansion later in the year.
Outlook for 2025
Despite Q1’s strong showing, economists warn of headwinds in the second half of 2025. The Brazilian government recently revised its full-year growth forecast upward to 2.4%, while Barclays projects a more cautious 2.1%, citing tighter financial conditions and a challenging global environment.
Still, some analysts argue that government stimulus and continued labor market strength may offset external risks. Measures such as workers’ severance fund withdrawals, expanded housing programs, and state-backed loans are expected to sustain domestic demand.
Brazil’s official Q1 GDP figures are scheduled for release on Friday, which will provide a clearer picture of the country's economic trajectory in a year marked by both recovery and restraint.
Azerbaijan’s Foreign Ministry on Saturday voiced deep concern over the escalating tensions following the United States’ military strikes on Iranian nuclear facilities, calling on all sides to prioritize diplomacy over confrontation.
The Pentagon concluded a high-stakes press briefing Saturday afternoon following the U.S. strikes on Iran’s nuclear facilities, outlining the scale and success of the mission while stressing the door remains open to diplomacy.
Türkiye has voiced strong concern following the United States’ strikes on Iranian nuclear facilities, warning that the action could dangerously escalate the conflict and trigger a global crisis.
Global investors are bracing for significant market turmoil when trading reopens, with analysts predicting a sharp spike in oil prices and a flight to safe-haven assets following the United States' announcement of military strikes against three Iranian nuclear facilities.
Iran’s top diplomat on Sunday issued a stark condemnation of the United States following overnight military strikes on Iranian nuclear facilities, declaring that Washington had crossed a "very big red line" and would be held "fully responsible" for the consequences.
Gulf states hosting major U.S. military bases were placed on high alert Sunday after American airstrikes destroyed Iran’s main nuclear sites, raising fears of regional retaliation and a broader conflict that could engulf key energy exporters and destabilise global security.
Senior Russian officials have condemned the United States’ recent military strikes on Iran, warning of a spiralling regional conflict and accusing U.S. President Donald Trump of igniting a "new war" that could backfire by strengthening Iran's leadership.
The United States has clarified that its recent military strikes on Iranian nuclear facilities were not intended to overthrow the Iranian government, but to neutralise what it described as urgent threats to national security, amid rising tensions and fears of broader regional conflict.
Iran's top security body, the SNSC, will decide on closing the Strait of Hormuz, a critical oil and gas chokepoint, after parliament's reported approval. A Revolutionary Guards commander stated the measure is "on the agenda," signaling escalating tensions.
Azerbaijan’s Foreign Ministry on Saturday voiced deep concern over the escalating tensions following the United States’ military strikes on Iranian nuclear facilities, calling on all sides to prioritize diplomacy over confrontation.
Iranian missiles struck multiple locations across Israel and neighbouring regions early Friday morning, including a Microsoft office complex, according to emergency responders and local media reports.
A high-speed tram derailment in central Gothenburg, Sweden, has left at least eight people injured late on Thursday (19 June), after the vehicle slammed into a snack bar on Avenyn Avenue.
China has unveiled a mosquito-sized bionic drone designed for covert military operations and battlefield reconnaissance, marking a major advance in micro-robotics and stealth technology as part of the country’s growing focus on next-generation warfare capabilities.
The 2025 G7 Leaders’ Summit was held June 15–17 in Kananaskis, Alberta, under Canada’s presidency. Prime Minister Mark Carney framed the meeting around priorities of protecting communities, energy and climate security, the digital transition, and future partnerships.
The USS Nimitz is heading to the Middle East amid tensions between Israel and Iran. The U.S. aircraft carrier has a decades-long history in the region, from the 1979 hostage crisis to modern deployments, often serving as a key asset during periods of rising friction with Iran.
Senior Russian officials have condemned the United States’ recent military strikes on Iran, warning of a spiralling regional conflict and accusing U.S. President Donald Trump of igniting a "new war" that could backfire by strengthening Iran's leadership.
The United States has clarified that its recent military strikes on Iranian nuclear facilities were not intended to overthrow the Iranian government, but to neutralise what it described as urgent threats to national security, amid rising tensions and fears of broader regional conflict.
The Pentagon concluded a high-stakes press briefing Saturday afternoon following the U.S. strikes on Iran’s nuclear facilities, outlining the scale and success of the mission while stressing the door remains open to diplomacy.
Global investors are bracing for significant market turmoil when trading reopens, with analysts predicting a sharp spike in oil prices and a flight to safe-haven assets following the United States' announcement of military strikes against three Iranian nuclear facilities.
A chorus of condemnation emerged from Latin America on Sunday as leaders from Chile, Cuba, Venezuela, Colombia, and Bolivia denounced the United States for its recent airstrikes on three Iranian nuclear facilities.
Gulf states hosting major U.S. military bases were placed on high alert Sunday after American airstrikes destroyed Iran’s main nuclear sites, raising fears of regional retaliation and a broader conflict that could engulf key energy exporters and destabilise global security.
Senior Russian officials have condemned the United States’ recent military strikes on Iran, warning of a spiralling regional conflict and accusing U.S. President Donald Trump of igniting a "new war" that could backfire by strengthening Iran's leadership.
The United States has clarified that its recent military strikes on Iranian nuclear facilities were not intended to overthrow the Iranian government, but to neutralise what it described as urgent threats to national security, amid rising tensions and fears of broader regional conflict.
Iran's top security body, the SNSC, will decide on closing the Strait of Hormuz, a critical oil and gas chokepoint, after parliament's reported approval. A Revolutionary Guards commander stated the measure is "on the agenda," signaling escalating tensions.
Azerbaijan’s Foreign Ministry on Saturday voiced deep concern over the escalating tensions following the United States’ military strikes on Iranian nuclear facilities, calling on all sides to prioritize diplomacy over confrontation.
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment