Brasilia, Brazil (4E) – Brazil’s economy in the second quarter slid into a technical recession, prompting the government to lower its growth forecast for 2014.
The country’s gross domestic product (GDP) contracted 0.6 percent in the second quarter, compared with the previous quarter, according to data from the Brazilian Institute of Geography and Statistics (IBGE) released Friday. The IBGE also revised down the first-quarter GDP to a 0.2 percent decline.
The decline means economic output in South America’s biggest economy has now dropped for two consecutive quarters, which is typically defined as recession by economists.
Following the release of the data, Brazil’s Finance Minister Guido Mantega said the government would now lower its full-year economic growth forecast.
In the second quarter, the country’s industrial activity slid 1.5 percent in the second quarter and investment fell 5.3 percent compared with the previous three months. At the same time, output across all sectors of the economy, except agriculture, fell.