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World Economy

OPEC Monthly Oil Market Report – September 2017

19

Non-OECD

BRICs

Table 3 - 2: Summary of macroeconomic performance of BRIC countries, 2017-2018*

Brazil

The economy of Brazil grew by 0.3% y-o-y in 2Q17, signalling its first expansion since 1Q14. This

improvement came on the back of the first acceleration in private consumption in more than two years.

It grew by 0.7% y-o-y in 2Q17 versus a 1.9% y-o-y contraction in the previous quarter. Trade was also

growth-supportive in 2Q17 as exports increased by 2.5% and imports dropped by 3.3% y-o-y. However,

contractions in government consumption and gross fixed capital formation (GFCF) mitigated the final growth

figure. Government consumption declined by the highest rate since the onset of the recession, reflecting

efforts to streamline public spending. It slid by 2.4% y-o-y in 2Q17 compared with 1.3% in 1Q17. The GFCF

also declined by 6.5% y-o-y in 2Q17 from a contraction of 3.7% in the previous quarter. The

trade surplus

of

Brazil widened in August to $5.6 billion, representing a 35.3% increase from a year earlier.

Exports

increased by 14.7% y-o-y, supported by manufactured products, which increased by 12.6%. Primary

products also posted a high rate of growth of nearly 19%, whereas growth in semi-manufactured products

slowed to 8.7% in August from more than 20% a month earlier. The trade surplus increased by more than

53% in 1H17, reaching $107.7 billion due to the record harvest of soy and higher prices of a number of main

exports like iron ore, soy and oil. Exports to China, Brazil’s top trading partner, increased by around 41%

y-o-y in August.

Imports

, on the other hand, grew at a lower rate of 8.0% y-o-y in August.

Graph 3 - 8: Brazilian inflation vs. Interest rate

Graph 3 - 9: Brazilian unemployment rate

2017 2018 2017 2018 2017 2018 2017 2018 2017 2018

Brazil

0.5

1.5

3.6

4.0 -12.5 -26.1

-7.9

-6.4 78.2 82.9

Russia

1.5

1.4

4.1

4.0 53.3 36.8

-2.2

-1.4 11.8 12.8

India

6.9

7.5

3.3

4.3 -21.2 -27.7

-3.2

-3.2 50.0 48.9

China

6.7

6.3

1.8

1.9 133.9 163.7

-3.9

-4.3 18.6 21.9

Sources: Consensus Economics, Economic Intelligence Unit, Financial Times, OPEC Secretariat and Oxford.

Note: * 2017 and 2018 = Forecast.

GDP growth rate

Consumer price

index,

% change y-o-y

Current account

balance, US$ bn

Government

fiscal balance,

% of GDP

Net public debt,

% of GDP

2.08

9.25

0

5

10

15

0

2

4

6

8

10

12

Jul 16

Aug 16

Sep 16

Oct 16

Nov 16

Dec 16

Jan 17

Feb 17

Mar 17

Apr 17

May 17

Jun 17

Jul 17

National consumer price index (LHS)

Selic rate (RHS)

Sources: Banco Central do Brasil, Instituto Brasileiro de

Geografia e Estatística and Haver Analytics.

% change y-o-y

% per annum

12.8

11.0

11.5

12.0

12.5

13.0

13.5

14.0

Jul 16

Aug 16

Sep 16

Oct 16

Nov 16

Dec 16

Jan 17

Feb 17

Mar 17

Apr 17

May 17

Jun 17

Jul 17

%

Sources: Instituto Brasileiro de Geografia e Estatística and

Trading Economics.