It shrank 0.8 percent in the first quarter, then 2.1 percent in the second, according to revised figures released Tuesday by Brazil’s statistics agency.
Advertisement
Brazil’s economy, in recession since mid-year, contracted 1.7 percent in the third quarter, compared to the April-June period, and decreased 4.5 percent relative to the same period in 2014, the Brazilian Institute of Geography and Statistics, or IBGE, said Tuesday.
Experts surveyed by the business daily Valor were expecting a 1.3 per cent contraction in the third quarter, as compared to the previous quarter. The 2.1% shrinkage in the second quarter was the worst since the final quarter of 2008, when GDP dropped 4.1%.
The real, Brazil’s currency, was not significantly affected by the news, remaining steady in early trading.
Latin America’s largest economy has been in recession since the second quarter of this year, and is going from bad to worse.
Last week the Supreme Court ordered the arrest of the country’s most famous dealmaker, banker André Esteves, and the president’s coalition leader, Senator Delcídio do Amaral, bringing Congress screeching to a halt.
Much of the slowdown can be pinned on a political crisis that has stalled the passage of economic reform proposals in Congress. President Dilma Rousseff has grown increasingly unpopular, with approval ratings of about 10% in recent polls, making it harder for her to convince lawmakers to support austerity measures.
The economy has shed more than 1.4 million formal jobs in the past year, causing the most unemployment since the 2009 global financial crisis.
Market-watchers have forecast a GDP fall of 3.2 percent for this year and 2.0 percent in 2016. Investment and exports also fell.
Advertisement
The central bank left its benchmark interest rate unchanged at nine-year high of 14.25 percent for a third straight meeting in November.
