Brazil: Industrial production grows at fastest pace in over two decades
February 2, 2011
In December, industrial production contracted a seasonally adjusted 0.7% over the previous month, which followed a 0.2% drop tallied in November. The reading surprised to the downside, as market analysts expected growth of 0.9%. On an annual basis, industrial output rose 2.7% in December, despite the previous year's unfavourable base effect when activity soared 19.0%. According to the Brazilian Institute of Geography and Statistics (IBGE, Instituto Brasileiro de Geografia e Estatistica), 11 of 26 sectors contracted in December. On a use-based classification, capital goods production dropped 0.5% over the previous month (November: +3.2% month-on-month) and the manufacture of consumption goods decreased 0.9% over the previous month (November: +0.4% mom). Vehicle production, which has been an important growth driver in 2010, expanded 0.1% in December (November: -0.6% mom). In the fourth quarter, industrial output rose 0.1% over Q3 in seasonally adjusted terms (Q3: -0.6% qoq sa). Despite weaker growth in the final months of the year, industrial production rebounded from the 7.4% contraction recorded in 2009, expanding 10.4% in 2010 ? the fastest pace in 24 years.