The IBC-Br Index, a gauge that estimates GDP, published by IBGE, fell by 0.26% in January, when compared to December.
The January decline was slightly lower than the previous month when the index dropped 0.32%. This marks the seventh month of falling activity. In comparison with January 2016, the index dropped 2.53%, while in the 12-month measure, there was a fall of 4.40%.
The IBC-Br is used as one of the measures by the Central Bank in rate setting decisions, with slower GDP, inflation should, in theory be lower, opening the space for more aggressive rate cuts. At its April meeting, the Monetary Policy Committee (Copom), is expected to increase cuts to 1%, against 0.75% in the last meeting.