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brazil recession

Brazil’s recession has deepened as the country’s economy shrank by 1.7% in Q3 of 2015 compared with the previous quarter.

The country’s GDP dropped 4.5% on an annual basis as investments fell 15%.

Brazil’s unpopular President Dilma Rousseff has been trying to cut spending and raise taxes and this new fall in economic activity will make the latter harder.

Dilma Rousseff’s government is also entangled in a massive corruption scandal.Brazil recession 2015

The drop in economic activity was largely due to a drop in investment, which fell by 15% compared with a year ago.

That has been falling for nine quarters in a row.

Unemployment is at a six-year high and inflation is running at 10%, meaning household spending is being squeezed.

Brazil’s credit rating was cut to junk in September because of mounting political turmoil and the difficulties faced by Dilma Rousseff’s government in tackling growing debt.

The rating means most of the world’s major investors cannot lend to Brazil.

In September, the Brazilian government announced a $7 billion package of spending cuts aimed at plugging the huge black hole in the country’s 2016 budget.

Dilma Rousseff’s public approval rating has hit record lows.

Brazil’s economy has been depressed by the end of the global commodities boom, while a corruption scandal centered on state oil giant Petrobras has damaged investor confidence.

Brazil’s economy has entered recession after official figures showed it contracted by 1.9% between in Q2 2015 compared with the previous three months.

Analysts had expected a contraction, but the number was worse than expected.

Q1 2015 output was also revised down to show a 0.7%, rather than a 0.2%, contraction.

Brazil, the seventh-largest economy in the world, has seen economic growth fall sharply in recent times.Brazil economy falls into recession 2015

This is due in part to low commodity prices and sluggish global growth.

High interest rates – currently 14.25% – have also affected consumer spending, an important element of Brazil’s economy, while this year, the government has introduced stringent austerity measures designed to tackle high levels of debt.

Government spending, including on unemployment benefits, has fallen sharply, while taxes have risen.

In Q2 2015, household spending fell by 2.1% compared with the previous three months. The biggest falls came in the industrial sector, where construction output fell 8.4%

Transport, storage, postal services, financial services and insurance all saw falls in output.

Compared with a year earlier, Brazil’s economy as a whole shrank by 2.6%.

The technical definition of a recession is two consecutive quarters of economic contraction.