Brazils economy grew 0.3% in May 2025 compared to April, according to main data from the Fundao Getulio Vargas (FGV).
The slight advance came despite tight monetary policy and slowing exports, highlighting the unexpected strength of domestic need and services.High interest rates, utilized by Brazils central bank to eliminate persistent inflation, continued to weigh on business costs and household credit.
With the Selic rate at 15% since early 2025, borrowing remains expensive, however customer costs stayed positive.Household usage rose for the fifth straight month, growing 2.1% in the three months ending in May.
Families kept buying both long lasting and daily goods, helping keep the economy from stalling.ServicesBrazils biggest sectorled the growth.
Many service markets grew other than retail.
In contrast, farming and industry had a hard time.
Farming, when a significant development driver, slowed as the strong soybean season ended.Industry also contracted as companies in producing invested less in machinery due to high financing expenses.
Investment, however, lastly revealed signs of recovery.Brazils Growth Slows in May as High Rates and Weak Exports Test Economic Strength.
(Photo Internet recreation)Gross repaired capital formation rose 6.9% in the three-month duration approximately May, primarily driven by building activity.
Machinery investment slowed dramatically, but increased facilities spending helped stabilize the decline.Brazils external trade offered less assistance than in previous years.
Exports in the 3 months ending May grew just 1.3%, while exports of mining items shrank 0.5% due to lower global commodity prices.More shipments went to the U.S., but volumes to China fell.
At the same time, imports rose 5.1%, slowing from a 10.7% increase in the earlier quarter, as firms continued importing items for production and infrastructure.By May, Brazils nominal GDP reached R$ 5.084 trillion ($900 billion).
The investment rate stood at 19.6%.
For many years, Brazils economy grew 3.4%, following a strong 3.0% increase in the previous quarter.The bottom line: Brazils economy keeps moving, however slowly.
Internal need, specifically services and family spending, assists offset weaker exports and high interest rates.The path forward depends upon whether inflation cools enough for rates to fall and on whether trade partners raise demand for Brazils goods.For now, Brazil reveals it can grow under pressurebut without financial area and much better trade terms, that growth might remain modest.