December 4, 2013 / 12:05 PM / 4 years ago

UPDATE 1-Brazil industry expands in October, capital goods slow

* Oct output rises 0.6 pct from Sept., beats estimates
    * Capital goods rise for 3rd month, though at slower pace

    By Asher Levine
    SAO PAULO, Dec 4 (Reuters) - Brazilian industry posted its
third straight month of timid gains in October, though capital
goods manufacturing expanded at a slower pace, suggesting that a
recovery in one of the weakest parts of Brazil's economy remains
on shaky ground.
    Industrial production in Brazil rose 0.6 percent
in October from September, government statistics agency IBGE
said on Wednesday, exceeding all estimates in a Reuters survey
of 28 analysts, which ranged from a contraction of 0.5 percent
to an expansion of 0.5 percent.
    Brazilian industry has had a mild recovery so far in 2013,
with output rising 1.6 percent in the first 10 months from the
same period last year, IBGE said. Growth has come in starts and
stops, however, as businesses continue to struggle with
competition from abroad, high tax and labor costs, and poor
    Even with industry expanding for three straight months, it
has yet to make up for the 2.5 percent decline seen in July from
    Data on Tuesday showed Brazil's economy shrank 0.5 percent
in the third quarter, contracting for the first time since early
2009. The industrial contribution to gross domestic product was
just 0.1 percent, while investment fell by 2.2 percent from the
previous three months, as stifling costs and sour business
sentiment discouraged capital spending. 
    Capital goods production expanded 0.6 percent in October
from September, down from a 4 percent monthly expansion in
September and a 2.3 percent advance in August, suggesting
businesses are continuing to brace for tougher times ahead. 
    October's industrial production expanded 0.9 percent from a
year earlier, exceeding the 0.4 percent increase
forecast in the Reuters survey. Estimates ranged from a 0.8
percent increase to a 2.30 percent decrease.
    After a 2.7 percent contraction in 2012, economists expect
industrial output to grow 1.69 percent this year, according to
the median forecast in a central bank poll. One month ago the
survey forecast industrial growth of 1.77 percent.
    Of the 27 industrial sectors surveyed by IBGE, 21 expanded
in October from September, including machinery and equipment,
oil refining and mining.
    In broader industrial categories, consumer and intermediate
goods both rose 0.3 percent.
    IBGE also revised some data from previous months.
September's industrial growth from August was revised to 0.5
percent from 0.7 percent previously. 

 (pct change)                   Oct/Sept   Oct'13/Oct
 Capital goods                        0.6        18.8
 Intermediate goods                   0.3        -0.7
 Consumer goods                       0.3        -1.3
     Durable consumer goods          -0.6        -3.2
     Semi-durable and                 1.0        -0.7
 non-durable consumer goods                
 Industrial output                    0.6         0.9
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below