Brazil: Industrial production picks up in June
August 2, 2016
In June, industrial production increased 1.1% over the previous month in seasonally-adjusted terms, which marked an improvement compared to the 0.4% expansion recorded in May and represented the highest reading since March. The result was slightly below the 1.3% rise expected by market analysts. Behind the acceleration was faster growth in the production of capital goods as well as rebounds in output of intermediate and consumer goods.
In annual terms, industrial production fell 6.0%, which was above the 7.5% drop recorded in May. Widespread declines were recorded across almost all categories of output with 20 of the 26 categories that the Brazilian Institute of Geography and Statistics (IBGE) surveyed recording contractions. The biggest negative impact was recorded in the production of mining and quarrying.
Moreover, annual average growth in industrial production slowed from minus 9.5% in May to minus 9.8% in June. 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.