Brazil moves out of recession

Second-quarter figures today showed Brazil has emerged from recession, as strong domestic consumption helped the economy grow.

Second-quarter figures today showed Brazil has emerged from recession, as strong domestic consumption helped the economy grow.

Latin America’s largest economy expanded 1.9% from April to June compared to the first quarter, following two consecutive quarters of declines.

The positive result came after the Brazilian government lavished tax breaks on individuals and businesses with an economic stimulus package.

The administration of President Luiz Inacio Lula da Silva also poured money into public works projects to counter the global slowdown and slashed taxes on new car purchases, prompting an extended buying spree.

The second-quarter growth figure was at the high end of expectations from analysts surveyed by the private Agencia Estado news agency.

Analysts have predicted Brazil will have overall flat or negative growth for all of 2009, but that the economy will register strong gains next year.

Brazil’s government predicts the economy will expand more than 4% next year.

In a report yesterday, the government said Brazilian inflation slowed in August and now stands at 4.4% for the past 12 months.

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