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Brazil’s economy is breaking down badly

The Maracana stadium is seen between Turano slum (L) and Mangueira slum, in Rio de Janeiro.
Reuters/Sergio Moraes
The economic forecast is hazy at best.
By Melvin Backman
Published Last updated This article is more than 2 years old.

Brazil just dropped its latest batch of GDP numbers, and they point to a deepening recession.

The country’s economy shrank 1.7% (link in Portuguese) in the third quarter versus the second, on top of a 2.1% contraction the previous quarter and a 0.8% dip the quarter before that. That’s the first three-quarter streak of negative GDP growth since 1999, and it’s a far worse one at that.

Unemployment in Brazil has jumped to five-year highs…

…and the value of the Brazilian real has continued to crumble.

Don’t forget that the country is in the midst of a corruption scandal that reaches the very top echelons of power, while a deluge of mining sludge is ravaging its countryside.

Capital Economics managed to find the bright side to all this, being that there’s always next year: ”The only hope (for the brave) is that things have been so bad this year that they can’t get much worse in 2016,” it wrote in a note to clients.

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