Brazil Industry May 2018

Brazil

Brazil: Industrial production records worst contraction in nearly 10 years

July 3, 2018

Industrial production plunged in May, dropping at the fastest pace since December 2008. Industrial output fell 10.9% month-on-month in seasonally-adjusted terms, contrasting April’s modest 0.8% increase. The print, however, surprised to the upside coming in above market expectations of a 13.8% decline. A nationwide strike by the truckers’ union, Abcam, over diesel price hikes in May caused widespread disruptions throughout the country, paralyzing key economic sectors and driving a broad-based decline in the index.

In annual terms, industrial production fell 6.7% in May, contrasting April’s 8.9% increase. Annual average growth also dropped, coming at 3.0% in May, below April’s 4.0%.

The analysts surveyed by FocusEconomics for this month’s LatinFocus Consensus Forecast see industrial production growing 3.6% in 2018, which is unchanged from last month's estimate. In 2019, industrial output is expected to grow 3.5%.


Author: Angela Bouzanis, Lead Economist

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Brazil Industry May 2018

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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