BRAZIL · PRIVATE SECTOR
Key Facts
- Reading Brazil’s composite PMI, which tracks factories and service firms together, fell to 44.4 in October.
- Change Down from 47.4 in September, the steepest fall in private-sector activity in over six years.
- New business New orders shrank at the sharpest rate since mid-2020.
- Three months The index has slid from 49.1 in August to 47.4 in September and 44.4 in October.
- Outlook The survey economist says the data point to a GDP contraction in the fourth quarter.
- Power Index Brazil ranks 1st of 14 in The Rio Times Latin America Power Index, with 74.2 points (November 2026 edition).
Brazil composite PMI dropped to 44.4 in October from 47.4 in September, S&P Global reported on Thursday 5 November. It is the steepest fall in private-sector activity in more than six years, and any reading below 50 means output is shrinking.
The composite index combines the survey of service companies with the survey of factories, so it is the broadest monthly gauge of Brazilian business activity. For US investors and exporters, it signals weaker demand in Latin America’s largest economy.
What the Composite Index Shows
The Composite Output Index measures whether Brazilian companies produced more or less than the month before. At 44.4, it signals a deep contraction, well below the 50 line that separates growth from decline.
The fall of 3.0 points in one month is the steepest drop in aggregate activity in more than six years. The survey ran in mid and late October, and its results were released at 10:00 Brasília time on 5 November.
A Three-Month Slide
The composite index stood at 49.1 in August, then fell to 47.4 in September and 44.4 in October. Each month has been weaker than the last.
Services pulled the October reading down most: the services index fell to 44.5 from 49.2. Our earlier report on the September services PMI shows where that index stood a month before.
Factories remain weak too, with the manufacturing PMI at 46.1 in October, up from 44.8 in September. Factory output has fallen for six straight months, according to S&P Global’s factory survey.
New Business Dries Up
New business across the private sector shrank at the sharpest rate since mid-2020, a period that included the first wave of the pandemic. That matters because orders today drive output and hiring in coming months.
In services, new orders fell for a second month at the fastest pace in more than five years. Service providers also cut jobs for a second month, though only marginally.
What the Economist Says
Pollyanna De Lima, economics associate director at S&P Global Market Intelligence, said clients held back on spending amid high prices and election-related uncertainty. She said October was a particularly tough month for service providers.
With manufacturing also struggling, she said the data so far point to a contraction in GDP in the fourth quarter. She added that the central bank may find room to lower interest rates should the trend continue.
In Plain English, Who Is Who
A PMI, or Purchasing Managers’ Index, is a monthly survey that asks company managers whether activity, orders, jobs and prices rose or fell. Readings above 50 signal growth, and readings below 50 signal contraction.
The composite PMI blends the services and manufacturing results into one number. S&P Global is the US data firm that runs the survey in Brazil and many other countries.
GDP, or gross domestic product, is the total value of goods and services a country produces. The central bank is Banco Central do Brasil, which sets the benchmark interest rate.
What It Means for You
For US investors, a sharp fall in business activity can mean weaker earnings for companies that sell inside Brazil, from banks to retailers. The survey economist also sees possible room for lower Brazilian interest rates, which would affect returns on Brazilian bonds and the real.
For US exporters and firms with Brazilian operations, shrinking orders can delay purchases and contracts. Readers can compare the trend with our earlier report on the September factory survey.
What Is Not Known
Whether activity stabilises will show in S&P Global’s November surveys, published in early December. S&P Global can answer that question when it releases the figures.
Whether the economy shrinks in the fourth quarter will be settled by IBGE, Brazil’s statistics office, in its GDP report for the quarter. That report comes after the year ends.
More: Latin America news in English, every day from The Rio Times.
Frequently Asked Questions
What is the Brazil composite PMI?
It combines S&P Global’s monthly surveys of Brazilian service companies and factories into one number. A reading above 50 means growth and a reading below 50 means contraction.
What was the October 2026 reading?
The composite index fell to 44.4 from 47.4 in September. It is the steepest fall in private-sector activity in more than six years.
How does it compare with the services PMI?
The services PMI fell to 44.5 from 49.2, and the manufacturing PMI rose to 46.1 from 44.8. Services pulled the composite down most.
What does the survey say about the fourth quarter?
The survey economist says the data so far point to a contraction in GDP in the fourth quarter. IBGE’s official GDP figure will confirm it after the year ends.
Sources: S&P Global, Brazil Services PMI press release (includes the Composite Output Index), 5 November 2026; S&P Global, Brazil Manufacturing PMI press release, 3 November 2026; S&P Global, Brazil Services PMI press release for September, 5 October 2026.
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error
Brazil runoff, Sunday, October 25: When is the Brazil runoff election. Latest: Brazil runoff polls, Flávio 51%, Lula 49%.