Brazil’s industrial production falls after nine months

Industrial output in Brazil dropped 0.7 percent in February after nine consecutive months of positive growth, according to data from the Brazilian Institute of Geography and Statistics. 

While activity is now 2.8 percent above pre-pandemic levels, the sector remains 13.6 percent below May 2011 — when Brazilian industrial production reached its peak — underscoring a long deindustrialization process in the country.

The carmaking sector has been hit particularly hard by the current crisis, due to a lack of inputs and a cooling of purchasing impetus from consumers. “The car and auto parts segments have pulled the sector down, even if truck production posted positive numbers,” says survey manager André Macedo.

He points out that, besides a shortage of inputs, industries have been hurt by massive unemployment (currently at 14.2 percent), rising inflation, unfavorable international conditions, and the discontinuance of the emergency aid program at the end of 2020 — now set to return next week.

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