Slipping Down: Brazil falls into recession

BRASILIA: Brazil, Latin America’s largest economy, has slid into recession; further weakening President Dilma Rousseff, who faces an increasingly tough re-election battle on October 5. GDP shrank 0.6 % in the second quarter, Brazil’s national statistics institute said, and revised its formerly positive growth estimate for the first quarter down to -0.2%. While most eyes were on football, industrial activity dipped 1.5% in April-June and second quarter investment slumped 5.3%, the IGBE national statistics agency figures showed. Rousseff’s administration has cut growth forecasts for the year to 1.8%, primarily blaming the global crisis. The Sao Paulo stock market took Friday’s data in its stride with the main Bovespa index ending the final August session 1.65 higher for a 9.63% rise across the month as a whole. The market welcomed the weak growth data and Rousseff’s current poll woes as positives which suggest her tenure may be coming to a close.

Published in The Express Tribune, August 31^st, 2014.

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