Brazil’s economy remained stuck in severe recession at the end of 2015 to log its worst yearly contraction in two-and-a-half decades, preliminary data from the statistical office IBGE showed Thursday.
Gross domestic product declined 1.4 percent from the third quarter, marking the fourth consecutive drop. Economists had forecast a worse fall of 1.6 percent.
In the third quarter, the economy contracted 1.7 percent. In the fourth quarter of 2014, GDP grew 0.1 percent.
The economy shrank 3.8 percent in 2015, which was the biggest contraction since 1990.
In the fourth quarter, both industrial and services sector shrunk 1.4 percent each. Farm output rose 2.9 percent.
Year-on-year, GDP dropped 5.9 percent in the fourth quarter.
Survey data released by Markit Economics on Thursday showed that the Brazilian private sector contracted at a record pace in February, mainly driven by a record decline in services activity. The survey also revealed substantial job losses.
The Brazilian economy is in poor shape amid recession and high inflation, and the outlook is also bleak, prompting the world’s three leading credit rating agencies to downgrade the country to junk.
Late Wednesday, the Brazilian central bank retained its key interest rate at a nine-year high of 14.25 percent for a fifth straight meeting, as a rate hike to tame inflation could do more harm to the recession hit economy.
President Dilma Rousseff’s government is struggling to move ahead with fiscal reforms as her popularity plummeted amid a political scandal that raised calls to impeach her.
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