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SAO PAULO — Brazil’s economy contracted slightly in the three months to September, government statistics agency IBGE said on Thursday, marking a recession in Latin America’s largest economy.
The 0.1% decline in Brazil’s gross domestic product (GDP) from the prior quarter was worse than the median forecast for 0.0% growth in a Reuters poll.
Revised data also showed a 0.4% drop in the second quarter, worse than the 0.1% decline reported previously. The two straight quarters of economic contraction meet the technical definition of a recession.
Brazil’s economic rebound from the worst of the COVID-19 pandemic has sputtered as inflation surged into double digits, forcing the central bank to raise borrowing costs aggressively. Some economists are warning of a deeper downturn next year.
The consensus forecast for 2022 economic growth has fallen from 2.3% in June to less than 0.6% in the latest central bank poll of economists, released on Monday.
Compared to the third quarter of 2020, Brazil’s economy grew 4.0%, IBGE data showed, below a median forecast of 4.2% growth. (Reporting by Camila Moreira Editing by Brad Haynes)
Brazil economy in recession after Q3 contraction - Financial Post
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