Brazil's economic activity declines in the second quarter and heads into recession

Economic activity in Brazil was slightly contracted between April and June, suggesting that the largest economy in Latin America could have sunk into recession.

As published by the country's central bank in its index of economic activity, IBC-Br, which constitutes an important signal of the nation's gross domestic product (GDP), data fell 0.13% in the second quarter, after falling 0.68% in the first three months of the year.

If the index relies on official GDP data this month, Brazil will have entered recession for the first time since the one recorded between 2015 and 2016. Part of the performance would explain by high unemployment, low industrial production, economic problems in Argentina the impact of the trade war on global growth.

Official figures for the second quarter will be released on August 29.. "For now, we keep our full estimate for 2019 at 0.5%, with a slight upward bias," Mauricio Oreng, strategist, told Reuters. senior from Rabobank to Sao Paulo.

"We expect a slight rebound in the second half of the year … but what we can say for sure is that the economy is still anemic and slow," he said. -he adds.

The actual Braisedo fell by nearly 1.5% in operations before market opening and during the first hours of trading, while the Bovespa stock index fell.

At the same time, a weekly survey conducted by the central bank among financial institutions showed that economists expect the interest rate, which was reduced last week, to fall to 5%. from here the end of the year.