Brazil Falls Deeper into Recession

Brazil’s economy shrank by 1.7% in the third quarter of the year compared with the second quarter, deepening the country’s worst recession in 25 years.

Compared with a year ago, the economy is 4.5% smaller.

The country’s unpopular President, Dilma Rousseff, has been trying to cut spending and raise taxes and this new fall in economic activity will make the latter harder.

Her government is also entangled in a massive corruption scandal.

The drop in economic activity was largely due to a drop in investment, which fell by 15% compared with a year ago.

That has been falling for nine quarters in a row.

Unemployment is at a six-year high and inflation is running at 10%, meaning household spending is being squeezed.

via BBC

Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza