Brazil's economy contracted by 0.2% in the first quarter as weak industrial and agricultural production, as well as lower capital investments, dragged on growth.

The reading from the country's statistics agency, IBGE, confirms estimates from Banco Central do Brasil, which had warned of a potential contraction for the three-month period.

In its latest market survey, financial agents cut forecasts for GDP growth for the 13th time in a row. It now sees expansion for 2019 at just 1.23%, about half the rate it had expected when Brazilian President Jair Bolsonaro took office at the start of the year. The official government forecast is now at 1.60%, down from a prior estimate of 2.2%.

According to market experts, delays in structural reforms are dampening companies' and individuals' willingness to invest or spend.

As of May 29, US$1 was equivalent to 4.00 Brazilian reais.