Industrial Production in Brazil Stabilizes in August, Shows Modest Growth

Brazil’s industrial production stabilized in August, showing a slight increase of 0.1%. This modest growth follows a 4.4% rise in June and a 1.4% decline in July.

The Brazilian Institute of Geography and Statistics (IBGE) typically considers a 0.1% variation as stability. August’s performance aligned with market expectations.

Financial institutions and consultancies surveyed by Valor Data predicted a median growth of 0.1%. Projections ranged from a 0.7% decrease to a 1.4% increase.

Compared to August 2023, industrial production rose by 2.2%. This figure slightly missed the market’s median expectation of a 2.3% increase.

Over the past 12 months, the industry has accumulated 2.4% growth. The industrial sector now stands 15.4% below its record level achieved in May 2011.

However, it remains 1.5% above the pre-pandemic level of February 2020. These figures highlight the industry’s gradual recovery.

August saw a decline in capital goods production compared to July. Intermediate goods and semi-durable and non-durable goods experienced growth. Capital goods fell by 4%, while durable goods decreased by 1.3%.

Intermediate goods, representing 55% of the industry, grew by 0.3% from July to August. Semi-durable and non-durable goods increased by 0.4% compared to both July and August 2023.

André Macedo, IBGE’s manager responsible for the monthly industrial survey, noted mixed signals. The return to positive territory is encouraging, but the prevalence of negative results raises concerns.

Despite recent fluctuations, Brazil’s industrial sector has shown stronger performance in 2024 compared to 2023. The cumulative growth of 3% in 2024 reflects this improved standing.

Macedo emphasized the need to monitor upcoming months for a clearer picture of the industrial sector’s behavior.

He acknowledged the industry’s current superior position compared to 2023 but noted its distance from historical peak levels.

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