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UPDATE 1-Brazil's economy grows 0.6% in Q3, fastest pace since early last year

Jamie McGeever

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BRASILIA, Dec 3 (Reuters) - Brazil's economy expanded in the third quarter at its fastest pace since early last year, official data showed on Tuesday, with 0.6% growth over the previous quarter driven by a strong performance in agriculture and a sharp rebound in industry.

Upward revisions to previous figures for the first two quarters this year meant that the economy no longer contracted in the January-March period, and so steered clearer of recession than had previously been thought.

Latin America's largest economy expanded by 0.6% in the third quarter of this year from the prior quarter, statistics agency IBGE said, more than the 0.4% forecast in a Reuters poll of economists and the highest since the first quarter of last year.

The 0.6% growth in Brazil's gross domestic product (GDP) took the rate of year-on-year growth up to 1.2%, also stronger than the 1.0% expansion forecast by economists.

The second quarter was revised up to 0.5% quarterly growth from 0.4%, and data show that the economy was flat the first quarter, as opposed to the 0.2% contraction initially estimated.

IBGE also revised up last year's overall economic growth to 1.3% from 1.1%.

Agribusiness grew by 1.3% in the July-September period and industrial production grew by 0.8%, the best performance in almost two years, IBGE figures showed.

The services sector, which accounts for more than 70% of the Brazilian economy, expanded by 0.4%.

On the flip side, government spending contracted for the second quarter in a row, shrinking by 0.4%, while net exports continued to be a drag on growth too, with exports falling 2.8% and imports rising 2.9%. (Reporting by Jamie McGeever; Editing by Alison Williams and Chizu Nomiyama)

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