Brazil economic activity down in February

The Brazilian central bank's economic activity index, released Friday, declined by 0.52 percent in February from the previous month on a seasonally adjusted basis, a result that hints at a poor GDP number for the first quarter.

The slowdown in economic activity was the sharpest for the month of February since the monthly IBC-Br index - regarded as a key predictor of gross domestic product performance - began to be compiled in 2003.

The result indicates the Brazilian economy, which has slowed as a result of global financial woes, is still floundering.

The IBC-Br index had risen 1.43 percent in January relative to December thanks primarily to a 2.6 percent rise in industrial output.

But industrial production declined by 2.5 percent in February, according to government figures released last week.

Despite the poor result relative to January, February's IBC-Br figure was up 0.87 percent from February 2012 on a non-seasonally adjusted basis.

Brazil's economy bounced back strong from the global recession by expanding 7.5 percent in 2010, but the nation's GDP grew just 2.7 percent in 2011 and a paltry 0.9 percent last year.

Both the government and private economists are forecasting stronger GDP growth this year, but the IBC-Br index has not yet reflected that a rebound is underway.

Private economists expect Brazil's GDP to expand by 3 percent this year, while the country's central bank said in a bulletin two weeks ago that it is forecasting 3.1 percent growth.