By Marcela Ayres
BRASILIA, March 3 (Reuters) – Brazil’s economy grew 2.3% in 2025 from the previous year, official data showed on Tuesday, marking a slowdown as ultra-tight interest rates weighed on activity in a bid to tame inflation.
Latin America’s largest economy posted 0.1% growth in the fourth quarter from the previous three months, matching the median forecast in a Reuters poll of economists.
On an annual basis, fourth-quarter gross domestic product (GDP) rose 1.8%, also in line with market expectations.
Full-year growth lost momentum from the 3.4% expansion recorded in 2024 and marked the weakest performance since a 3.3% contraction in 2020, when the economy was hit by the COVID-19 pandemic.
The slowdown came in a year dominated by restrictive monetary policy aimed at steering inflation – 4.1% in the year through mid-February – toward the central bank’s 3% target.
Brazil’s economy proved slow to cool following stimulus measures under President Luiz Inacio Lula da Silva that boosted demand and helped growth outperform earlier expectations.
Central bank policymakers paused an aggressive tightening cycle in July and have since kept the benchmark Selic rate at 15%, the highest in nearly two decades. They recently signaled they intend to begin cutting rates at their next policy meeting later this month.
(Reporting by Marcela Ayres; Editing by Gabriel Araujo)
