The New York Times‘ Simon Romero is reporting that Brazil’s economic growth has been sluggish in the third quarter. Romero writes:
“Brazil’s economy registered anemic growth in the third quarter as investment levels remained disappointingly low, according to figures released on Friday. The results cast doubt on policies meant to prevent Brazil from turning into a laggard among Latin America’s economies. Gross domestic product grew just 0.6 percent from the previous quarter, stunning economists who had forecast double that rate. Brazil’s economy is now expected to grow only about 1 percent in 2012, delivering a challenge to President Dilma Rousseff, who has tried to increase growth through an array of huge stimulus projects.”
President Rousseff’s economic policies aggressively direct large government banks and other state-controlled enterprises in order to promote growth. The last year of former President Luiz Inácio Lula da Silva’s tenure, Brazil’s economy grew 7.5 percent. The third quarter report suggests that Brazil is on track to deliver its weakest two-year period of growth since the early 1990s, before a stabilization program that radically restructured the economy. Nonetheless, Finance Minister Guido Mantega contends that Brazil is on the cusp of a recovery, forecasting 4 percent growth next year.
Read more at The New York Times.