Brazil: Industrial production expands in January
March 4, 2016
In January, industrial production grew 0.4% over the previous month in seasonally-adjusted terms, which marked a rebound from the 0.5% fall recorded in December and represented the highest reading since May 2015. The result surprised market analysts who had expected a 0.5% contraction. The improvement was driven by gains in capital and intermediate goods, while production of consumer goods deteriorated.
In annual terms, industrial production decreased 13.8%, which marked a deterioration compared to the 12.1% contraction recorded in December. A decrease in output was recorded in 23 of the 26 categories that the Brazilian Institute of Geography and Statistics (IBGE) surveyed. The biggest negative impact was recorded in the production of motor vehicles and trailers.
Meanwhile, annual average growth in industrial production dropped from minus 8.2% in December to minus 9.0% in January. 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.