Brazil’s economy contracted morethan expected in August, cementing expectations that policymakers will continue to cut interest rates.
Economic activity, a proxy for gross domestic product, fell0.53 percent in August from the previous month, according to thecentral bank’s seasonally adjusted index, after expanding arevised 0.34 percent in July. The decline was steeper than themedian forecast of a 0.4 percent slide from 13 analysts surveyedby Bloomberg.
Consumer prices rose 7.31 percent in the year throughSeptember, exceeding the 6.5 percent upper limit of the centralbank’s target range for a sixth straight month. The bank targetsinflation of 4.5 percent, plus or minus two percentage points.
Retail sales in August fell the most since March 2010.Industrial output contracted in August for the third time infive months, while business confidence in the third quarter fellto its lowest level in more than two years.