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| Brazil's economy falls into recession, latest figures show | Brazil's economy falls into recession, latest figures show |
| (35 minutes later) | |
| Brazil has fallen into recession, just a month before the general election, latest figures show. | Brazil has fallen into recession, just a month before the general election, latest figures show. |
| Economic output, GDP, fell by 0.6% in the three months to June, worse than analysts had predicted, and revised figures for the first quarter of the year also showed a fall of 0.2%. | Economic output, GDP, fell by 0.6% in the three months to June, worse than analysts had predicted, and revised figures for the first quarter of the year also showed a fall of 0.2%. |
| A recession is usually defined as two consecutive quarters of contraction. | A recession is usually defined as two consecutive quarters of contraction. |
| The news will be damaging for the government of President Dilma Rousseff. | The news will be damaging for the government of President Dilma Rousseff. |
| According to the most recent poll, Ms Rousseff would lose to a rival candidate, environmentalist Marina Silva, if October's election went to a second round. | According to the most recent poll, Ms Rousseff would lose to a rival candidate, environmentalist Marina Silva, if October's election went to a second round. |
| The World Cup, held in June and July, was not regarded as generally good for business, says the BBC's Wyre Davies in Rio de Janeiro. | The World Cup, held in June and July, was not regarded as generally good for business, says the BBC's Wyre Davies in Rio de Janeiro. |
| "There were more days off for employees and many traditional tourists stayed away," he says. | "There were more days off for employees and many traditional tourists stayed away," he says. |
| "The problem is that, with elections due in early October, the economy is increasingly seen as President Dilma Rousseff's weak point." | "The problem is that, with elections due in early October, the economy is increasingly seen as President Dilma Rousseff's weak point." |
| The data showed that civil construction, manufacturing and investment especially suffered during the second quarter. | |
| 'Worrying slowdown' | |
| "This recession shows the exhaustion of a growth model that has been centred on internal consumption," said Eduardo Velho, chief economist at investment firm INVX Global in Sao Paulo. | "This recession shows the exhaustion of a growth model that has been centred on internal consumption," said Eduardo Velho, chief economist at investment firm INVX Global in Sao Paulo. |
| "It is a good picture of what the economy is suffering - a slowdown in industry, a fall in investment, rising inventories. The recovery from here will be slight," he continued, saying that deep reforms would be needed whoever wins the next election. | "It is a good picture of what the economy is suffering - a slowdown in industry, a fall in investment, rising inventories. The recovery from here will be slight," he continued, saying that deep reforms would be needed whoever wins the next election. |
| The second quarter figures prompted analysts to revise down expectations for full-year figures. | |
| "With the sharp fall in investment, the potential GDP growth rate shows a significant and worrying slowdown in recent quarters," said Cristiano Oliveira, economist at Banco Fibra in Sao Paulo. | |
| "That said, we now expect no growth in the Brazilian economy in 2014, despite moderate growth in the global economy." | |
| Analysis: Katy Watson, business reporter, Sao Paulo | Analysis: Katy Watson, business reporter, Sao Paulo |
| A decade ago, Brazil was the darling of emerging economies. The country reaped the benefits of soaring commodity prices and government spending helped millions of poor Brazilians enter the middle class - the future looked bright. | A decade ago, Brazil was the darling of emerging economies. The country reaped the benefits of soaring commodity prices and government spending helped millions of poor Brazilians enter the middle class - the future looked bright. |
| But it's a very different picture now. Investor and consumer confidence has fallen, just like industrial output and retail sales are struggling too. | But it's a very different picture now. Investor and consumer confidence has fallen, just like industrial output and retail sales are struggling too. |
| The World Cup may have taken people's minds off economic worries temporarily, but the issue is now top of the agenda. There is just over a month to go before the presidential elections and today's figures will be seen as an opportunity for candidates hoping to unseat President Dilma Rousseff. | The World Cup may have taken people's minds off economic worries temporarily, but the issue is now top of the agenda. There is just over a month to go before the presidential elections and today's figures will be seen as an opportunity for candidates hoping to unseat President Dilma Rousseff. |
| They'll use the R-word to try to convince voters that their economic policies are a better alternative for the country's future. | They'll use the R-word to try to convince voters that their economic policies are a better alternative for the country's future. |