Brazilian economy showing signs of weakness

Last Updated: Thursday, November 15, 2012 - 11:59

Rio de Janeiro: The Brazilian economy shrank by 0.52 percent in September compared with August, the biggest one-month decline in almost a year, the central bank said Wednesday.

The central bank's IBC-Br index of economic activity, seen as a reliable predictor of GDP movement, fell for the first time since March, from 143.34 points to 142.59.

September's IBC-Br reading cast doubt on the government's forecast that GDP will grow 2 percent this year despite a gain of only 0.6 percent in the first quarter.

Even with the weak performance in September, the IBC-Br expanded by 1.15 percent in the third quarter compared with the previous three months, the central bank said.

The index was also up 1.2 percent over the level reached in the first nine months of 2011.

Private economists surveyed by the central bank predict the Brazilian economy will grow 1.54 percent in 2012 and by 4 percent next year.

Latin America's economic giant suffered a sharp but relatively brief slowdown in the wake of the 2008 global financial crisis and rebounded with growth of 7.5 percent in 2010.

Last year, however, the Brazilian economy managed an expansion of only 2.7 percent.


First Published: Thursday, November 15, 2012 - 11:55

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