COVID-19 Hits Brazil Economy As GDP Likely To Crumble 9.4%
The South American country is in its worst three-month phase with its GDP at an all-time low due to the coronavirus
South America’s largest country, Brazil’s economy is likely to crumble 9.4% in its second quarter. This is its worst three-month period, owing to the unending wrath of the coronavirus pandemic.
There was some upward trend in the economic activity after President Jair Bolsonaro launched fiscal spending to deal with the repercussions of COVID19. However, Bolsonaro’s original austerity agenda is questionable if the scheme continues for long.
Brazil leads at second position after the United States of America, with 3.6 million cases of corona infections.
The latest gross domestic product (GDP) data, to be released on September 1 is likely to lead to a controversial debate about what Economy Minister and Wall Street favourite Paulo Guedes believes on one hand and the extent of the vast initiative, on the other. Economists are already criticising the government over the soaring budget deficit.
The country’s GDP possibly collapsed 9.4% in April-June in quarter on quarter basis following a 1.5% drop in the first quarter, according to the median estimate of 33 economists polled in August. Almost all the respondents cited the weakening of the economy and highlighted the rising unemployment and companies holding back on capital spending.
Experts were expecting an increase of 10.7% versus a projected drop of 12.7% in May in the country which has seen more than 115,000 deaths till now, due to the continuing pandemic.
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