Brazil’s Economic Activity Tumbles Past All Forecasts as Key Rate Cut Bets Grow
- Central bankers left door open for rate reductions in August
- Economies are also weakening in other regional countries
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Brazil’s economy shrank more than expected in May according to the central bank’s main gauge of activity, as President Luiz Inacio Lula da Silva’s government advances key reforms and investors bet on rate cuts.
The bank’s economic activity index, a proxy for gross domestic product, fell 2% from the prior month, more than all forecasts in a Bloomberg survey that had a -0.10% median estimate. From a year ago, the gauge increased 2.15%, according to data published on Monday.