Brazil: Industrial production contracts in October
December 2, 2016
In October, Brazilian industrial production fell 1.1% from the previous month in seasonally-adjusted terms, which contrasted the 0.5% expansion recorded in September. The result was below expectations of a milder 0.8% decrease. Behind the downturn was a steep fall in output of intermediate goods.
In annual terms, industrial production fell 7.3%, which was a larger drop compared to the 4.7% decrease recorded in September and marked a five-month low. Widespread declines were recorded nearly across the board with 22 of the 26 categories that the Brazilian Institute of Geography and Statistics (IBGE) surveyed recording contractions. The categories that declined the most were the production of mining and quarrying, coke, oil products and biofuels as well as of food products.
Annual average growth in industrial production improved from minus 8.7% in September to minus 8.4% in October. Brazil’s economy has sunk into the worst recession in its modern history amid low prices for key exports, high inflation, political turmoil and depressed confidence levels.