Business

Anadolu Agency

SÃO PAULO — Brazil’s economy will shrink by 1 percent in 2015, down markedly on previous forecasts, according to a report by the IMF released on Tuesday.

“Latin America’s outlook will continue to weaken due to lower commodity prices. Brazil’s outlook is also affected by a drought, tighter macroeconomic policies, and weak private sector sentiment,” the report said.

The IMF analysis also cited the risk of water and energy rationing and repercussions from a sprawling corruption scandal at state-run oil giant Petrobras, Brazil’s largest company, as complicating the country’s economic outlook.

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Anadolu Agency

SÃO PAULO — Stocks and bonds of Brazilian state-controlled oil giant Petrobras slumped on Wednesday, after Moody’s stripped the company of its investment grade rating.

Petrobras shares on the São Paulo Bovespa stock exchange fell sharply on opening, and were still down 7 percent by 1 p.m. in the city (GMT1600), with the Ibovespa index down more than 1 percent at the same time.

The New York-based credit ratings agency announced late on Tuesday its decision to downgrade Petróleo Brasileiro SA, as Petrobras is formally known, by two notches from Ba2 to Baa3 — from investment grade to speculative or “junk” territory. Read Full Article

Anadolu Agency

SÃO PAULO — Brazil’s key stock exchange index and national currency both sank on Tuesday morning, a day after new surveys showed President Dilma Rousseff had overtaken rival Aécio Neves in the polls.

In the first minutes of trading, the Ibovespa plunged more than 2,300 points, or 4.4 percent, with state energy companies Petrobras and Eletrobras suffering the biggest losses.

The real also suffered a sharp fall, opening at 2.464 against the dollar but within minutes weakening to 2.50.

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Anadolu Agency

SÃO PAULO — Disappointing levels of investment, confidence and competitiveness means Brazil’s economy will barely grow this year, according to a key report by the International Monetary Fund published on Tuesday.

The October edition of the global lender’s flagship World Economic Outlook report slashed its July estimate of 1.3 percent to 0.3 percent, which, if confirmed, would be the second worst performance by the Latin American economic powerhouse since 1998.

Currently the world’s seventh economy, Brazil should grow more in 2015, the report says, but still less than previously predicted, revising down a previous estimate of 2.0 percent to 1.4 percent.

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Anadolu Agency

SÃO PAULO — The remaining two candidates in the Brazilian presidential race met with campaign teams on Monday to plan negotiations to secure rivals’ supports and redraw political battle lines ahead of the runoff on 26 October.

Sunday’s first-round vote saw incumbent and leftist Workers’ Party candidate President Dilma Rousseff take 41.5 percent of valid votes, but center-right Brazilian Social Democracy Party candidate and market favorite Aécio Neves performed unexpectedly well, finishing in second with 33.6 percent, forcing a fourth consecutive runoff between the two parties.

Former environment minister Marina Silva, running for the Brazilian Socialist Party (PSB), placed third with 21 percent of support, meaning elimination from the race.

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Anadolu Agency

SÃO PAULO — The Brazilian real made modest gains on Wednesday after the country’s central bank said it would significantly increase its interventions on the foreign exchange market.

The move comes after the real plunged to a seven-month low of 2.408 against the U.S. dollar, the first time the currency had broken through the 2.40 mark since 12 February, when it closed at 2.423.

The real strengthened to 2.399 just after 14:00 São Paulo time on Wednesday, after weakening to 2.417 earlier in the day.

[UDPATE: By close of business on 24 September, the real had strengthened further, to 2.383.]

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Anadolu Agency

SÃO PAULO — Moody’s Investors Service changed its outlook on Brazil’s government bond rating from “stable” to “negative”, according to a company report released on Tuesday.

The New York-based ratings agency said Brazil’s “sustained low growth” and “worsening debt metrics” all contributed to a risk of reduced creditworthiness, which could “trigger a downward migration in its credit rating”.

“Moody’s expects that Brazil’s economy will continue to record low growth, and estimates that annual GDP [gross domestic product] increases are likely to remain below the country’s potential of around three percent,” the ratings agency said.

The company said it expected economic growth to expand by “less than one percent in 2014 […] the lowest annual rate since 2009” and that next year would see growth “below the two-percent mark.”

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Anadolu Agency

SÃO PAULO – The Brazilian economy has fallen into recession a little more than a month before the country’s general elections, according to figures released on Friday by Brazil’s national statistics agency, the IBGE.

Economic output fell 0.6 percent in the second quarter of 2014, compared to the first quarter, the agency said.

Previous figures indicated that the GDP had grown 0.2 percent between January and March, but the revised numbers show the economy had actually shrunk 0.2 percent in the first quarter, signaling a technical recession – defined as two consecutive quarters of negative growth.

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