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Brazil PMI April 2024

Brazil: Manufacturing PMI rises to near three-year high in April

The S&P Global Brazil Manufacturing Purchasing Managers’ Index (PMI) rose to 55.9 in April from 53.6 in March. April’s reading was the highest since July 2021. As a result, the index moved further above the 50.0 no-change threshold, and signaled a faster improvement in manufacturing sector operating conditions compared to the previous month.

April’s improvement was primarily driven by growing demand: New business intakes rose at the sharpest pace in nearly three years and new export orders also expanded, exiting a 25-month sequence of contractions. This increase in demand spurred production volumes and job creation—the latter rising at the quickest speed in 21 months—in turn. Firms responded by ramping up their purchasing activity to the highest level since September 2021. However, this heightened demand also placed pressure on supply chains, contributing to some operational challenges.

Regarding prices and business sentiment, April saw a significant uptick in both input costs and output charges, with the former rising at the fastest rate since August 2022 due to increased commodity and transportation costs, alongside shortages of certain inputs and crop failures. Business sentiment was bolstered to a three-month high by improved demand, the Central Bank’s ongoing loosening monetary policy cycle and product diversification.

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