(Recast, adds historical data and context)
BRASILIA Dec 15 Economic activity in Brazil
declined in October for the fourth straight month, shattering
expectations that Latin America's No. 1 economy would soon begin
to emerge from the harshest recession in eight decades.
The IBC-Br index, which takes the pulse of the agricultural,
industrial and service sectors, fell 0.48 percent from
September, central bank data showed on Thursday. Analysts
expected a 0.50 percent drop.
The deepening recession and allegations of corruption
against President Michel Temer and other senior politicians have
rekindled political instability in Brazil only four months after
the impeachment of his predecessor, Dilma Rousseff.
"We expect the economy to continue to face headwinds from
exigent financing conditions, a weak labor market, high levels
of household indebtedness, weak external demand, contained
consumer and business confidence amidst growing political
uncertainty," said Alberto Ramos, chief Latin America economist
with Goldman Sachs Group Inc.
Temer plans later on Thursday to announce measures to ease
the debt of businesses and consumers in an attempt to breathe
some life into the second-largest emerging market economy.
The drop in October was the eighth in 10 months. With the
recession in its second year, millions of Brazilians have lost
their jobs, and scores of companies have filed for bankruptcy
(Reporting by Alonso Soto; Editing by Angus MacSwan)