SAO extensionPAULBrazil, January 5 – Industrial production in Brazil fell 0.1 percent in November compared with the previous month, the government’s statistics agency said on Thursday ibg extensionwhich kept the sector below pre-pandemic levels and underlined a negative trend in recent months.
November’s data, which matched the median estimate from a Reuters poll of economists, marked the fourth decline in the past six months, according to the ibg extension.
Brazil’s industrial sector experienced a brief recovery at the start of the year but has lost momentum recently due to accelerating inflation and rising interest rates, as well as a slowdown in the global economy and stagnating wages .
“The sector has been hovering around a plateau, but on a downward trend,” said research director Andre Macedo, adding that the quarterly moving average showed a “very clear downward path.”
The latest figures came as Brazilian Vice President Geraldo Alckmin took office Wednesday as the country’s new minister of development, industry and trade, promising to reindustrialise Latin America’s largest economy and help cut rates of interest.
In annual terms, according to art ibg extensionproduction grew by 0.9% in November, in line with economists’ forecasts.
Even so, industrial production in Brazil remains 2.2% below its pre-pandemic levels in February 2020 and 18.5% below its all-time high in May 2011, according to statistics.
Capital Economics chief emerging markets economist William Jackson said the November data provided further evidence that the Brazilian economy was in a “slowdown” scenario.
“But the central bank will wait for further signs that inflation is nearing target and, perhaps more importantly, that fiscal risks are easing, before cutting interest rates again,” he added.
Brazil’s key interest rate is currently at 13.75%, following aggressive monetary tightening aimed at controlling inflation.
