BRASILIA (Reuters) – Brazil’s economy will likely undergo a “significant” contraction in the second quarter, economic policy secretary Adolfo Sachsida said on Friday, adding that sticking to the government’s spending cap rules will help provide a springboard for recovery in the second half of the year.
Speaking to reporters in Brasilia after the government slashed its 2020 growth forecast to zero, Sachsida warned against fiscal largesse to support the economy, saying spending too much now risked putting Brazil into a new crisis once this transitory one passes.
(Reporting by Marcela Ayres; Writing by Jamie McGeever; Editing by Chizu Nomiyama)
