Brazil Industry May 2017

Brazil

Brazil: Industrial production decelerates in May

July 4, 2017

In May, industrial production rose 0.8% from the previous month in seasonally-adjusted terms, which was below April’s revised 1.1% increase (previously reported: +0.6% month-on-month). The result overshot market expectations of a 0.6% increase and marked a second consecutive month of growth as manufacturers gradually recover from Brazil’s deep recession.

Behind the deceleration was slower growth of intermediated goods which expanded a meagre 0.3% month-on-month. Meanwhile, production of capital and consumer goods picked up steam.

In annual terms, industrial production rebounded, growing a healthy 4.0% (April: -4.2% year-on-year)—the best result since February 2014. 18 of the 26 categories that the Brazilian Institute of Geography and Statistics (IBGE) surveyed recorded expansions, with the largest increase seen in the production of motor vehicles and trailers. In addition, the trend improved notably and the annual average variation in industrial production rose to minus 2.2% from 3.1%.

The analysts surveyed by FocusEconomics for this month’s LatinFocus Consensus Forecast see industrial production growing 1.1% in 2017, which is down 0.1 percentage points from last month's estimate. In 2018, industrial output is expected to grow 3.2%.


Author: Angela Bouzanis, Senior Economist

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Brazil Industry May 2017

Note: Month-on-month changes of seasonally adjusted industrial production and annual average growth rate in %.
Source: Brazil Institute of Geography and Statistics (IBGE) and FocusEconomics calculations.


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