Economists covering the Brazilian economy cut their 2014 growth forecast to the slowest ever as the central bank raises interest rates to tame inflation.
Latin America’s biggest economy will expand 1.62 percent this year, compared with the previous week’s forecast of 1.69, according to the May 16 central bank survey of about 100 analysts published today. Inflation will quicken to 6.43 percent by year end, the survey also showed.
President Dilma Rousseff’s administration has been struggling to revive growth as above-target inflation slows demand. Economic activity as reported by the central bank contracted in March, as retail sales and industrial output shrank. Traders expect the central bank to hold interest rates unchanged this month after raising it nine consecutive times, swap rates show.
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