Economists now expect the economy to grow by just 0.86% in 2014, down from the 0.90% outlook from the previous week, according to a survey conducted by the Brazilian Central Bank. Four weeks ago, the outlook was 1.07% growth.
For 2015, economists still expected the GDP to grow by 1.50%.
Economists have become increasingly pessimistic about the nation's economy. At the start of 2014, the survey put GDP growth at 1.99%. The outlook for 2015 was 2.48%.
The gloomy outlook comes as June industrial production fell by 1.40% versus May and by 6.90% versus June 2013, according to the IBGE, the state statistical agency.
The June producer price index fell by 0.13% month on month, but rose by 1.32% year on year, IBGE said.
Among the 23 groups that make up the index, chemical products fell by 1.12% month on month and rose by 2.69% year on year.
Rubber and plastics rose by 0.06% month on month and by 3.58% year on year.Oil products and biofuels fell by 0.48% month on month and rose by 9.35% year on year.