S&P Global reported that in March, Brazil’s manufacturing sector showed resilience as the Purchasing Managers’ Index (PMI) dipped slightly to 53.6 from February’s 54.1.
This figure, staying above the crucial 50.0 threshold for the third consecutive month, signals ongoing expansion.
The sector’s performance in March is notably robust, registering as the second-highest since July 2022.
This positive trend is driven by a revival in demand, evident from the increase in new orders for three straight months at the fastest pace in over two years.
All major industrial sectors saw improvements, particularly in capital goods, buoyed by the surge in business activities.
Manufacturers boosted their production in response to this uptick, showcasing one of the most significant output expansions since mid-2021.
Pollyanna De Lima, Associate Director of Economics at S&P Global Market Intelligence, pointed out that the industrial sector kicked off 2024 stronger than it concluded 2023.
The average PMI for the first quarter of 2024 was the highest observed since the period leading to September 2021.
According to De Lima, efforts to restock and meet customer demand have not only spurred job creation but also led to increased input purchasing.
Despite cost pressures staying relatively low and price inflation dropping to a three-month low, external demand remains cautious.
Brazilian manufacturers are finding it challenging to secure new international orders, with demand shortfalls in Asia, Europe, and Latin America particularly concerning.
This situation underscores the sector’s resilience while also highlighting areas for strategic focus to sustain growth.
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