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By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – The GDP growth in Brazil registered a decline of 3.2 percent during the first nine months of the year, in comparison to the same period last year, according to the IBGE (Brazilian Statistics Bureau). The growth decline is the steepest in nineteen years, adding bad news on top of ongoing negative economic reports for Brazil.

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Brazilian’s automotive industry registered steep decline in 2015 , photo by Marcelo Camargo/ABr.

According to the IBGE data, the biggest decline was seen in investment of capital goods (Gross Fixed Capital Formation – GFCF) which fell by 12.7 percent, followed by industry (-5.6 percent) and services (-2.1 percent). The only sector registering a growth in GDP during the period was that of agribusiness, of 2.1 percent.

“In general, we see a deterioration in employment and income, a hike in interest rate which in turn hinders access to credit and affects directly consumption and investments,” said Claudio Dionisio, the IBGE’s quarterly accounts manager, when announcing the results. The official also noted that the foreign exchange rate and inflation also contributed to this scenario.

Household consumption fell by 0.3 percent while government consumption declined by 0.4 percent, according to the Bureau. The entity also registered a decline in imports of goods and services (-12.4 percent) while export of the same increased by four percent. According to the government forecasts for the 2016 GDP growth should also be negative.

Along with the accumulated GDP results for 2015, the IBGE also released data on the year’s third quarter showing a decline in the GDP of 1.7 percent in comparison to the second quarter of 2015 and -4.5 percent in comparison to the third quarter in 2014.

For the third quarter of 2015, all sectors registered a decrease in their GDP, with agribusiness leading the way, with a retraction of 2.4 percent, industry retracted by 1.3 percent while services fell by one percent.

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