Brazil economists for the first time forecast the recession will deepen from 2015, which was already the sharpest contraction for Latin America’s largest economy in 25 years.
Economists lowered their 2016 GDP call to 3.88 percent from 3.8 percent previously, according to the weekly Focus survey conducted April 22. That’s worse than the 3.85 percent recession registered last year.
A swirling political crisis that’s come to the brink of toppling President Dilma Rousseff has weighed on business confidence and frozen investment. With consumers likewise rattled by rising joblessness and inflation at more than double the government’s target, families are strapped for cash and tightening their belts. That’s put growth forecasts onto a downward spiral, with this week’s outlook marking the fourteenth straight reduction.