SÃO PAULO -- Brazil's economy finally emerged during the first quarter from its worst recession on record, as record harvests and growing exports outweighed shrinking consumer spending and business investment.
Gross domestic product in Latin America's biggest economy expanded a seasonally adjusted 1.0% in the first quarter from the three months ended in December, the Brazilian Institute for Geography and Statistics said Thursday, after contracting for eight consecutive quarters. The economy shrank 0.4% in the first quarter from a year earlier.
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Agriculture expanded 13.4%, while exports increased 4.8% and industry grew 0.9%. Household spending fell 0.1% in the first three months of the year, business investment declined 1.6%, and government spending shrank 0.6%. Services were stagnant.
Many economists warned that Brazil isn't out of the woods yet, because the bumper crops in the first quarter won't be repeated in the second quarter and because most other parts of the economy are still underperforming.
"Services and industry are a mess," said André Perfeito, an economist at São Paulo-based Gradual Investimentos. "Unemployment is high and wages aren't growing, so there's no demand on the horizon" to spur investment.
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(END) Dow Jones Newswires
June 01, 2017 08:54 ET (12:54 GMT)