Brazilian Economy Ministry on Wednesday said it downgraded its economic growth forecast for 2020 from 2.4 percent to 2.1 percent.
The ministry's Macrofiscal Newsletter, published by the Economic Policy Secretariat, said the downgrade was due to the negative effects of the novel coronavirus pandemic on the local and world economies.
"The expected impacts on the Brazilian economy are between minus 0.1 and minus 0.5 percentage points in growth in 2020, with close to 0.3 percentage points being the most probable scenario," the report said.
How much of an impact the pandemic has "will depend on its scale and the dynamic of its recovery," it said, adding the epidemic could disrupt production chains and restrict productivity as employees fall ill.
The outbreak could also lead to a drop in consumer demand and a resulting decrease in global gross domestic product, as well as lower prices for basic goods and a reduction in available financing.
Private sector analysts in Brazil also downgraded their growth projections to 1.99 percent, according to a Central Bank of Brazil survey published Monday.
In 2019, Brazil's economy saw 1.1 percent growth, the poorest performance in three years.