Brasília, May 28, 2004 (Agência Brasil) - The 1.6% growth in the Gross Domestic Product (GDP) in the first quarter of this year, compared with the last quarter of 2003, confirms the continuation of the gradual recovery of activity initiated in the second half of 2003. This evaluation is part of a note released yesterday (27) by the National Confederation of Industry (CNI).

According to the note, the results correspond to the expectations of the organization, which did not revise its forecast for this year's growth. "The CNI continues to expect an increase of 3.5%-4.0% in industrial production and something on the order of 3% for the GDP, as stated in the organization's Conjunctural Bulletin for the first quarter," the note says.

In the note the CNI highlights "the good performance of manufacturing, which grew 6.0% in comparison with the same quarter of last year." For the Confederation, the factor that has stimulated the increase in production is the heating up of foreign demand, represented by the average quarterly growth of 5.6%, or 24% on an annualized basis.

The note informs that CNI specialists consider it impossible to imagine a robust growth in the GDP, as long as family consumption remains stagnant. "Sustained GDP growth will only take place when there is a recuperation of income and employment, which depend, in turn, on the performance of investments," it concludes.

Translator: David Silberstein