Brazil PMI May 2018

Brazil

Brazil: Manufacturing PMI drops to 10-month low in May

June 1, 2018

Conditions in Brazil’s manufacturing sector weakened in May according to the IHS Markit. The manufacturing Purchasing Managers’ Index (PMI) decreased from 52.3 in April to 50.7 in May, the worst result in 10 months. Despite the fall, the PMI still lies above the crucial 50-threshold that separates expansion from contraction in business conditions in the manufacturing sector.

The fall in the index was attributed to weaker growth in new orders and output, with both categories recording the slowest expansions in over one year. The uncertain political environment was reported to have weighed on new orders and firms added jobs at a modest pace in May. In addition, business confidence fell on the back of challenging economic conditions. Meanwhile, prices pressures continued to climb amid higher prices for fuel, gas and other commodities.

The analysts surveyed by FocusEconomics for this month’s LatinFocus Consensus Forecast see industrial production growing 3.9% in 2018, which is unchanged from last month's estimate. In 2019, industrial output is expected to grow 3.8%.


Author: Angela Bouzanis, Lead Economist

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Brazil PMI May 2018

Note: Markit Brazil Purchasing Managers’ Index (PMI). A reading above 50 indicates an expansion in business activity while a value below 50 points to a contraction.
Source: IHS Markit.


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