Brazil analysts forecast that Brazil’s economy faces two straight years of recession for the first time since the Great Depression.
Brazil’s economy will shrink by 2.01 percent in 2015 and by 0.15 percent in 2016, according to the Aug. 14 central bank survey of about 100 analysts. That marks their first forecast for recession next year and compares with the previous week’s predictions of a decline of 1.97 percent in 2015 and flat growth in 2016. The last time the economy shrank for two straight years was in 1930-31.
President Dilma Rousseff is struggling to balance policies aimed at taming the fastest inflation in over a decade while reviving economic growth amid a massive corruption scandal that has complicated relations with Congress. Moody’s Investors Service this month became the second ratings company to cut the country’s sovereign credit rating to the cusp of junk. Protests on Sunday that drew half a million people into the streets will maintain the pressure on a government with record-low popularity ratings.