BRASÍLIA --  In line with market expectations, the Brazilian economy contracted 0.5% in the third quarter of this year compared with the previous one, official statistics released Tuesday showed.

Compared with the same period of 2012, the world's seventh largest economy grew 2.2%, the Brazilian Institute of Geography and Statistics said.

On Monday Finance Minister Guido Mantega projected 2.5% GDP growth in the third quarter compared with the same period of last year.

The GDP figures between July and September, when compared with the previous quarter, showed that the agribusiness sector retreated 3.5% while industry and services edged up 0.1%.

When compared from year to year, industry rose 1.9% and services 2.2% but agribusiness was down 1%.

Capital formation surged 7.3% while household consumption rose 2.3%.

The Brazilian economy grew 1.8% in the second quarter over the previous one, exceeding market expectations.

Last year, it posted only 0.9% growth after 2.7 percent in 2011 and a sizzling 7.5% in 2010.

This year authorities and market analysts are banking on a 2.5% expansion.

Copyright Agence France-Presse, 2013