Brazil: Industrial output growth moderates in February
Industrial production increased 0.5% on a month-on-month seasonally-adjusted basis in February, moderating from January’s revised 1.2% rise (previously reported: +0.9% month-on-month), surpassing market analysts’ expectations of a 0.4% decline in February.
Softer growth in February was driven by shrinking production of consumer goods, both for durable and non-durable goods. Moreover, capital goods output weakened sharply and intermediate goods production lost some steam. Industrial output increased in 15 of the 26 sectors surveyed, led by the automotive and chemical production sectors.
In annual terms, industrial production dipped 0.4% in February, although fell at a weaker pace than the 0.9% decline in January. Meanwhile, annual average industrial output fell 1.2% in February, down from 1.0% drop in January, signaling a worsening trend in the industrial sector.
Looking ahead, while the industrial sector showed some resilience in February, data for March is expected to show a deeper effect of the coronavirus crisis on Brazilian factory output. Ford Motor Company and General Motors were forced to shut down production in mid-March, while measures to control the pandemic are hampering supply chains.