Brazil’s manufacturing PMI falls from 44.3 in November to 44.2 in December

Brazil’s industrial Purchasing Manager’s Index (PMI) fell from 44.3 in November to 44.2 in December, the second-fastest deterioration in the sector’s health since May 2020, released on Monday. (2) S&P Global.

The PMI average for the fourth quarter, still according to S&P, was the lowest since the second quarter of 2020. The monthly result covered the third straight drop in new business, which drove the sharpest decline in output since May 2020.

Businesses indicated that economic uncertainty and uncertainty regarding the new government’s public policies dampened sales in December, with customers postponing and canceling purchases.

The hiring rate decreased from November, in contrast, it was the second fastest since May 2020. The decline in new orders registered in the month led to a further contraction in the headcount. Employment fell at the fastest rate in two and a half years.

In December, there was a drop in new orders for exports, to one of the highest levels seen since the beginning of data collection, around 17 years ago, points out the S&P, in a report. Companies reported weak demand from Europe, Latin America and the US.

Companies also reduced the purchase of inputs at the end of 2022, the rate of reduction was the second fastest since May 2020. The weak demand for inputs eased the pressure on suppliers’ capacity, with that the average delivery times decreased for the second consecutive month and at a record pace.

“The PMI survey tells us that customers and manufacturers remain anxious about future public policy and the resilience of the economy, with these concerns keeping the sector firmly contracted in December,” says S&P Global Associate Director of Economics, Pollyanna de Lima, in note.