Brazil’s economy grows 0.6 pct in Q3, fastest pace since early last year

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Brazil’s economy expanded in the third quarter at its fastest pace since early last year, official data showed on Tuesday, with 0.6 percent growth over the previous quarter driven by a strong performance in agriculture and a sharp rebound in industry.

Upward revisions to previous figures for the first two quarters this year meant that the economy no longer contracted in the January-March period, and so steered clearer of recession than had previously been thought.

Latin America’s largest economy expanded by 0.6 percent in the third quarter of this year from the prior quarter, statistics agency IBGE said, more than the 0.4 percent forecast in a Reuters poll of economists and the highest since the first quarter of last year.

The 0.6 percent growth in Brazil’s gross domestic product (GDP) took the rate of year-on-year growth up to 1.2 percent, also stronger than the 1 percent expansion forecast by economists.

The second quarter was revised up to 0.5 percent quarterly growth from 0.4 percent, and data show that the economy was flat the first quarter, as opposed to the 0.2 percent contraction initially estimated.

IBGE also revised up last year’s overall economic growth to 1.3 percent from 1.1 percent.

Agribusiness grew by 1.3 percent in the July-September period and industrial production grew by 0.8 percent, the best performance in almost two years, IBGE figures showed.

The services sector, which accounts for more than 70 percent of the Brazilian economy, expanded by 0.4 percent.

On the flip side, government spending contracted for the second quarter in a row, shrinking by 0.4 percent, while net exports continued to be a drag on growth too, with exports falling 2.8 percent and imports rising 2.9 percent.