The Brazilian economy contracted more-than-expected, at the fastest pace in six years, during the second quarter to enter a technical recession, preliminary figures from the statistical office IBGE showed Friday.
Gross domestic product declined 1.9 percent from the first quarter, when the economy shrunk 0.7 percent, which was revised down sharply from a 0.2 percent contraction reported earlier. Economists had expected a 1.7 percent slump. The latest contraction was the most severe since 2009.
Two consecutive quarters of GDP decline leads to a technical recession. In the fourth quarter of last year, the economy stagnated.
Gross fixed capital formation dropped 8.1 percent, marking its eighth consecutive quarter of decline. Households' consumption expenditure decreased 2.1 percent, down for a second straight quarter.
"As expected, the driver was a complete collapse in domestic demand," Capital Economics economist Neil Shearing said.