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2026-02-19 21:08:12
[Brazil's Economic Activity Expected to Grow by 2.5% in 2025, Agriculture Acts as Economic "Shock Absorber"] ⑴ Data released by the Central Bank of Brazil on Thursday showed that the country's economic activity index grew by 2.5% year-on-year in 2025, a slowdown from the previous year, but still exceeding initial expectations for the second consecutive year. Strong performance in the agricultural sector was a key support for the economy. ⑵ This index (IBC-Br) is widely regarded as a leading indicator of GDP, combining estimates of agriculture, industry, services, and production-related taxes. Excluding the robust 13.1% growth in agriculture, the index's growth in 2025 would fall to 1.8%. Official GDP data will be released on March 3. ⑶ A weekly survey of economists predicts GDP growth of 2.3% in 2025, down from 3.4% in 2024. This slowdown comes after the central bank ended its aggressive tightening cycle in July, with the benchmark Selic interest rate remaining at a near two-decade high of 15%. Policymakers have hinted at the start of an easing cycle next month. (4) In December, the seasonally adjusted IBC-Br index fell 0.2% month-on-month, less than the market expectation of 0.5%. The index rose 0.4% quarter-on-quarter in the fourth quarter, with all sectors except industry recording positive growth. Analysts point out that weak economic activity at the end of 2025 provides support for upcoming easing policies.
