Brazil: Industrial production recovers in March
May 3, 2016
In March, industrial production grew 1.4% over the previous month in seasonally-adjusted terms, which marked a rebound from the 2.7% fall recorded in February and represented the highest reading since January 2014. However, March’s rise was still below market analysts’ expectations of a 1.6% expansion. The improvement was driven by a broad-based recovery, with growth recorded in the production of consumer and intermediate goods. In addition, production of capital goods gained steam.
However, in annual terms, industrial production fell 11.3%, marking a deterioration compared to the 9.8% drop recorded in February. A decrease in output was recorded in 22 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.
Moreover, annual average variation in industrial production fell from minus 9.0% in February to minus 9.7% in March. 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.