Brazil: Industrial production stalls in May
July 1, 2016
In May, industrial production was stable over the previous month in seasonally-adjusted terms, contrasting the 0.2% growth recorded in April and marking the lowest reading since February. The result was in line with market analysts’ expectations. Behind the deterioration was a contraction in the production of intermediate goods and a slowdown in production of capital goods. However, production of consumer goods rebounded in May.
In annual terms, industrial production dropped 7.8%, coming down from the 6.9% drop recorded in April. A decrease in output was recorded in 21 of the 26 categories that the Brazilian Institute of Geography and Statistics (IBGE) surveyed. The biggest negative impact was recorded in the production of oil products and fuels.
Meanwhile, annual average growth in industrial production inched up from minus 9.6% in April to minus 9.5% in May. 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.