Brazil: Manufacturing PMI falls to over-six-year low
November 3, 2015
The Markit manufacturing Purchasing Managers’ Index (PMI) fell from September’s 47.0 to 44.1 in October, which marked the worst result in 79 months. As a result, the PMI lies far below the 50-threshold that separates contraction from expansion in business conditions in the manufacturing sector.
According to Markit, October’s downturn came on the back of significant drops in both output and new orders. Moreover, firms shed jobs at the fasted pace in six-and-a-half years. In addition, the weak vale of the real continued to impact prices and cost inflation rose in October. Markit analysts added that, “Brazil’s manufacturing economy took a turn for the worse in October. Following softer declines in production and new orders in September, rates of contraction gained speed at the beginning of Q4. The latest PMI dataset also shows the longest sequence of continuous reduction in output since the global financial crisis, highlighting the magnitude of Brazil’s economic malaise.”