Brazil’s economy had its worst showing in more than a decade in the last quarter of 2008, adding to pressure on the central bank to cut interest rates aggressively to prevent an even steeper downturn.

Gross domestic product contracted by 3.6% from the previous quarter according to the government statistics office, much more than expected and the worst figure since the current series began in 1996. The market consensus had been for a fall of about 2.3%.

It brings an end to three years of steady growth in Brazil and will put further strain on the notion that Brazil is relatively immune to the global economic crisis.

Financial Times