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Brazil in recession, unemployment high

Brazil in recession, unemployment high article image

Brazil officially entered recession this week as gross domestic product figures showed a 0.8 percent drop for the first quarter of the year, following the 3.6 percent contraction in the last quarter of 2008. Latin America's largest economy - and the one tipped to become a global economic power in a couple of decades - is taking heart from the fact that the contraction figure was comparatively lower than predicted. The GDP had also been positive for part of the quarter, reported the Brazilian Geography and Statistics Institute, up 3.1 percent in March compared with the same month last year. The service sector saw modest growth, 1.7 percent more than the same quarter last year. Finance Minister Guido Mantega predicts "gradual improvement" in the latter half of this year with acceleration in the third and fourth quarters of 2010: "The economy is showing a capacity for recovery. Gradually we'll recover the growth rates seen last year." However, recent data also shows that unemployment has reached and two-year high of nine percent.

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