Brazilian Industry Confirms Erratic First Half

08/02/2017 - 11h16

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LUCAS VETTORAZZO

FROM RIO

The industry confirmed an erratic behavior at the end of the first half, interspersing rises and falls and with difficulty to find a sustainable path of recovery.

Brazil's industrial production was stable in June, after rising in April (1.3%) and May (1.2%), the Brazilian Institute of Geography and Statistics (IBGE, in its Portuguese acronym) reported on Tuesday (1st).

The increases were concentrated in sectors that benefit from exports, such as food products (4.5%), extractive industry (1.3%), and pulp and paper (1.2%).

Capital goods, which are the machines used in production lines and the main investment thermometer, increased by 2% in May and June.

According to analysts heard by Folha, however, the good news comes in relative terms, since they are mainly agricultural equipment, with focus on the export.

Sectors linked to domestic demand, such as petroleum products (-1.7%), motor vehicles (-3.9%) and computer products (-4.9%), remain with a weak performance.

The current domestic market scenario still does not enable a change in the production level of the industry, which is currently 20% lower than in the middle of 2013.

In the annual comparison, of June with the same period of 2016, the industry had a slight increase of 0.5%, surpassing the expectation of analysts, who predicted a decrease of 0.3%.

According to CNI (National Confederation of Industry) economist Marcelo Souza Azevedo, the industry is in the "moment of transition", in search of the ideal level of production.

Translated by MARINA DELLA VALLE

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