Brazilian economy grew 2.2% in 2025, according to FGV preview

The Brazilian economy grew 2.2% in 2025, compared to 2024, estimated the GDP Monitor survey, released this Friday (20) by the Brazilian Institute of Economics (Ibre) of the Getulio Vargas Foundation (FGV).

The research brings together data from industry, commerce, services and agriculture and is considered a preview of the gross domestic product (GDP), an indicator of all goods and services produced in the country.

The 2025 result represents the fifth consecutive year of increase, even with a loss of pace in recent months. In 2024, the increase had been 3.4%.

In December, GDP had zero variation (0%) compared to November, and, in the fourth quarter, it was also stable in relation to the third.

Sectors

When detailing the sectoral behavior of the economy, the GDP Monitor estimates that household consumption will grow by 1.5% in 2025.

The so-called Gross Fixed Capital Formation (GFCF), an indicator that reflects the level of investment in the economy, such as purchases of machinery and equipment, expanded by 3.6% in the year.

In foreign trade, exports increased by 6.2% in 2025, while imports increased by 5.1%.

The study estimates that the economy’s investment rate was 17.1%, the highest in the last three years.

Records

According to FGV, in monetary terms, Brazilian GDP in current values reached R$12.63 trillion, the highest value in the historical series.

GDP per capita ─ value of GDP divided by the size of the country’s population ─ reached R$59,182, also a record level.

Analysis

According to the coordinator of the Ibre National Accounts Center, economist Juliana Trece, high interest rates were one of the reasons that led to the loss of strength in the economy’s growth in 2025.

“There is an evident loss of momentum in GDP throughout 2025, with the rate, in the seasonally adjusted series [ajuste que permite a comparação entre meses e trimestres imediatamente seguidos]having started the year with strong growth and ending it stable in the fourth quarter of 2025”.

Effect of interest

Juliana Trece points out that 2025 was “a year of strong monetary tightening and the imposition of tariffs on Brazil”.

Monetary tightening refers to high interest rates. In September 2024, concerned about the trajectory of inflation, the Monetary Policy Committee (Copom) of the Central Bank (BC) began an escalation of the economy’s basic interest rate, the Selic, then at 10.5% per year, raising it to 15% in June 2025. remaining so to this day.

The government’s inflation target is 3% over a 12-month period, with a tolerance of 1.5 percentage points (pp) higher or lower.

The Broad Consumer Price Index (IPCA), considered the official inflation number, became 13 months outside the tolerance rangewhich includes practically all of 2025.

Selic influences all other interest rates in the country and, when high, acts restrictively on the economy, that is, it makes credit operations more expensive and discourages investment and consumption.

The expected impact is lower demand for products and services, cooling inflation. The side effect is that a slow economy tends to reduce job creation.

Despite the restrictive pressure, 2025 ended with the lowest percentage ever recorded in the unemployment rateas announced by the Brazilian Institute of Geography and Statistics (IBGE).

Tariff

The other effect cited by the economist is the tariff imposed by the President of the United States, Donald Trump, which began in August 2025. The application of additional taxes on Brazil led to a reduction in foreign sales to Americans.

The United States government claims that the measure aims to protect the American economy, since, with taxation, the country tends to manufacture products locally instead of purchasing them abroad.This Friday, a decision by the US Supreme Court overturned Trump’s tariff policy.

In November, the vice-president and minister of Development, Industry, Commerce and Services, Geraldo Alckmin, calculated that 22% of exports to the United States were subject to surcharges.