Brazilian industry resumed growth in March for the first time in five months as new orders and production rebounded, although business confidence has weakened to a low since October with the war in Ukraine, the Purchasing Managers’ Index survey found. (PMI) from S&P Global.
The Brazilian manufacturing PMI rose to 52.3 in March from 49.6 in February, returning to above the 50 mark that separates growth from contraction for the first time since October and the highest in six months.
S&P Global highlighted, however, that the result was insufficient to offset the contractions seen this year, and that on average for the first quarter the PMI remains below 50.
Data shows that orders to Brazilian industry rose for the first time in six months, with respondents citing strengthening demand, winning new customers and restocking efforts among customers.
With higher sales, production volume also increased, expanding for the first time since September, although there was a further decline in export orders.
Improved demand further favored manufacturing employment in March, with the growth rate recording the strongest pace since October 2021.
Despite the improvement in March, the general level of positive sentiment in the industry fell to the lowest since October. Companies remained confident that production will increase in the year ahead, but heightened uncertainty around price pressures, input shortages, economic instability and the war between Russia and Ukraine dampened optimism in the sector.
In March, input costs rose the most so far this year. The actors mentioned were the conflict in Ukraine, which started at the end of February, as well as the strength of the dollar and the mismatch between demand and supply.
As a result, the prices charged were raised again and the inflation rate hit a seven-month high. Almost 43% of the companies consulted indicated an upward revision of their sales prices, against less than 1% who indicated lower numbers.
Source: CNN Brasil
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