Brazil Industry

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Brazil: Industrial production improves in October

December 3, 2015

In October, industrial production contracted 0.7% over the previous month on a seasonally-adjusted basis, which was a less pronounced contraction than the revised 1.5% decrease (previously reported: -1.3% month-on-month) seen in September. However, the result was worse than market analysts’ expectations of a 0.2% fall. The figure was driven by a smaller fall in the production of intermediate goods and consumer goods, while capital goods swung to contraction in October.

In annual terms, industrial production plummeted 11.3% in October, which was a deterioration from September’s revised 10.9% fall (previously reported: -10.8% year-on-year) and marked the worst reading in over six years. A decrease in output was recorded in 24 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.

The trend continued to point downward in October, with annual average growth in industrial production falling from September’s minus 6.4% to minus 7.1%. Annual average growth has followed a broad downward trend since March 2014.

The analysts surveyed by FocusEconomics for this month’s LatinFocus Consensus Forecast see industrial production falling 7.4% in 2015, which is down 0.5 percentage points from last month's estimate. In 2016, industrial output is expected to contract 2.4%, which is down 1.2 percentage points from last month’s forecast.


Author: Angela Bouzanis, Senior Economist

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Brazil Industry October 2015

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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