Brazil’s industrial production fell in November for the second time in three months, as Latin America’s biggest economy struggles to emerge from a slowdown that has lasted more than a year.
Industrial output declined 0.6 percent in November, the national statistics agency said today in Rio de Janeiro, after rising a revised 0.14 percent in October. Economists had expected output to decrease 0.9 percent from the previous month, according to the median forecast in a Bloomberg survey of 36 analysts.
Output fell 1 percent from the year before, compared with a median forecast for a 0.7 percent decrease from 33 economists surveyed by Bloomberg.
President Dilma Rousseff’s government has worked to reactivate Brazil’s industry by cutting payroll taxes, lowering levies on consumer and industrial goods to boost demand and pressuring commercial banks to lower lending costs. Meanwhile, since August 2011 the central bank has cut the benchmark interest rate by 525 basis points, more than any other Group of 20 nation, to a record low 7.25 percent.
The administration has also enacted measures to weaken the real, which has declined 10.5 percent against the dollar in the past year, the second-weakest performance among 16 major currencies tracked by Bloomberg.
Still, Brazil’s economy is forecast to have grown 0.98 percent in 2012, according to the latest central bank survey of about 100 economists, less than the U.S. and its peers in the BRIC group that includes Russia, India and China. The economy grew 2.7 percent in 2011, and 7.5 percent in 2010.
Confidence in the industrial sector fell in December, according to a survey by Brazil’s national industry confederation, CNI. Brazil’s vehicle production in November fell 2.8 percent from the month before and output from extractive industries declined 6.7 percent, according to the statistics agency. Of the 27 industrial sectors studied, 16 registered a decline, the agency said.
Swap rates on the contract maturing in January 2015, the most traded in Sao Paulo today, rose five basis points, or 0.05 percentage point, to 7.75 percent at 9:30 a.m. local time. The real was little changed at 2.0462 per U.S. dollar.
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