Brazil Manufacturing Growth At 8-Month Low; Industrial Output Falls Further

(RTTNews) - Brazil's manufacturing activity expanded at the weakest pace in the current eight-month sequence of growth amid a renewed fall in new orders, survey data from S&P Global showed on Tuesday.

Separate official data revealed that industrial production declined for the second consecutive month in September.

The purchasing manager's index for the manufacturing sector dropped to 50.8 in October from 51.1 in September. However, a reading above 50 suggests expansion in the sector.

New business intakes declined for the first time in eight months due to weak underlying demand. In the midst of challenging economic conditions, new export orders also decreased.

Input prices decreased for the first time in eight years in October, linked to recent cuts to fuel and energy taxes, coupled with a drop in commodity prices.

As a result, firms reduced their selling prices, and the fall was the first in almost five-and-half years and the strongest since August 2009.

Production and employment continued to expand modestly as firms remained upbeat towards growth prospects.

Preliminary data from the statistical office IBGE showed that industrial production decreased at a stable rate of 0.7 percent month-on-month in September versus an expected fall of 0.6 percent.

The industrial sector is still 2.4 percent below the pre-pandemic level in February 2020 and 18.7 percent below the record level reached in May 2011, the agency said.

On a yearly basis, industrial output rose 0.4 percent in September, following a 2.8 percent gain in August. The expected increase was 0.7 percent.