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GDP falls 9.7% in the 2nd quarter of 2020, points out IBGE

Posted by Marina
Gross Domestic Product (GDP) fell 9.7% in the second quarter of 2020 (compared to the first quarter of 2020), in the seasonally adjusted series. Compared to the same period in 2019, GDP fell 11.4%. Both rates were the most intense falls in the series, which started in 1996. In the accumulated of the four quarters ended in June, there was a drop of 2.2% in relation to the four immediately previous quarters.

In current values, GDP in the second quarter of 2020 totaled R $ 1.653 trillion, of which R $ 1.478 trillion in Value Added (VA) at basic prices and R $ 175.4 billion in Taxes on Products net of Subsidies.

The investment rate in the second quarter of 2020 was 15.0% of GDP, being below that observed in the same period of 2019 (15.3%).

In the first half of 2020, GDP fell 5.9% in relation to the same period in 2019. In this comparison, there was a positive performance for Agriculture (1.6%) and declines in Industry (-6.5%) and Services (-5.9%). The supporting material for the Quarterly National Accounts is on the right.

GDP falls 9.7% in relation to the immediately previous quarter

Under the effects of the COVID-19 pandemic and social isolation, GDP fell 9.7% in the second quarter of 2020, compared to the first quarter of 2020, in the seasonally adjusted series. This was the most intense drop in the historical series, which started in 1996. Among the segments, the biggest drop was in Industry (-12.3%), followed by Services (-9.7%). Agriculture showed a positive change of 0.4%.

Among the industrial activities, the highlights were the falls in Manufacturing Industries (-17.5%), Construction (-5.7%), in the activity of Electricity and gas, water, sewage, waste management activities (- 4.4%) and in the Extractive Industries (-1.1%).

In Services, the negative results were: Other service activities (-19.8%), Transport, storage and mail (-19.3%), Commerce (-13.0%), Administration, defense, public health and education and social security (-7.6%), Information and communication (-3.0%). On the other hand, there was a positive result in Financial activities, insurance and related services (0.8%) and in Real estate activities (0.5%). From the expenditure perspective, Gross Fixed Capital Formation (-15.4%), Household Consumption Expenditure (-12.5%) and Government Consumption Expenditure (-8.8%) fell in relation to immediately preceding quarter.

Exports of Goods and Services grew 1.8%, while Imports of Goods and Services decreased 13.2% in relation to the first quarter of 2020.



Fall of 11.4% in relation to the 2nd quarter of 2019 is the biggest of the series, started in 1996

Compared to the same period in 2019, GDP fell 11.4% in the second quarter of 2020, this being the biggest quarterly contraction recorded in the historical series, which started in 1996, for this basis of comparison. Value Added at basic prices fell by 10.8% and Taxes on Net Products from Subsidies decreased by 15.6%.

Among the activities, Agropecuária grew 1.2%, compared to the same period in 2019, which can be explained, mainly, by the performance of some crop products that have a relevant harvest in the second quarter and by productivity.

Industry had a drop of 12.7%, the most intense of the historical series, in this comparison. The Manufacturing Industries activity had the worst result (-20.0%), another negative record in the historical series, influenced mainly by the decrease in vehicle manufacturing; other transport products; machinery and equipment; and in the textile and clothing industry. The second most intense decline came from Construction (-11.1%), corroborated by the reduction in occupation and production of its inputs.

Electricity and gas, water, sewage and waste management activities decreased by 5.8%, explained by the decline in the economy as a whole. On the other hand, the Extractive Industries presented a positive variation of 6.8%, with an increase in oil extraction. The extraction of ferrous ores continues to fall, but at lower rates.

Services, on the other hand, fell 11.2% in relation to the same period of 2019, the biggest drop ever recorded in the historical series. The worst results were in Other service activities (-23.6%) and Transport, storage and mail (-20.8%). There were decreases in Commerce (-14.1%), Administration, defense, public health and education and social security (-8.6%) and Information and communication (-3.2%). On the other hand, Financial activities, insurance and related services (3.6%) and Real estate activities (1.4%) presented positive results.

Household Consumption Expenses contracted by 13.5%, an index that represents the biggest drop recorded in the historical series. This was the second negative result of this comparison after 11 quarters of progress. The index can be explained by the social isolation in the country, the prohibition of the operation of some activities especially of services provided to families, in addition to the drop in the wage mass in the country in the second quarter of 2020.

Gross Fixed Capital Formation decreased 15.2% in the second quarter of 2020 compared to the same period in 2019. The decrease is justified by the negative results registered both in the domestic production of capital goods and in construction. Government Consumption Expenditure fell 8.6% compared to the second quarter of 2019.

In the external sector, Exports of Goods and Services grew 0.5%, while Imports of Goods and Services decreased 14.9% in the second quarter of 2020.

GDP fell by 2.2% in the accumulated in four quarters

The accumulated GDP in the four quarters ended in June 2020 contracted 2.2% in relation to the four immediately previous quarters. This rate resulted from the 2.1% drop in Value Added at basic prices and 3.0% in Taxes on Products Net of Subsidies. The Added Value result in this type of comparison was due to the following performances: Agriculture (1.5%), Industry (-2.5%) and Services (-2.2%).

Investment rate was 15% in the 2nd quarter

The investment rate in the second quarter of 2020 was 15.0% of GDP, remaining below that observed in the same period of the previous year (15.3%). The savings rate was 15.5% against 13.7% in the same period of 2019.

GDP falls 5.9% in first half

GDP in the first half of 2020 fell 5.9% in relation to the same period in 2019. On this basis of comparison, there was a positive performance for Agriculture (1.6%). In Industry (-6.5%) and Services (-5.9%) the performance was negative.

GDP reaches 1.7 trillion in the second quarter of 2020

Gross Domestic Product in the second quarter of 2020 totaled R $ 1.653 trillion, of which R $ 1.478 trillion in Value Added at basic prices.

Source: DATAGRO

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