Brazil’s industrial output stayed flat in May as business confidence recovers on hopes the new administration of Acting President Michel Temer will pull Latin America’s largest economy out of recession.

The result was in line with the median forecast from 37 economists surveyed by Bloomberg and followed a revised 0.2 percent increase in the prior month. Not since 2012 has Brazil’s industry gone three straight months without a contraction. From a year earlier, industrial production fell 7.8 percent, the national statistics agency said Friday.

Industry pessimism has begun to dissipate in Brazil despite some initial stumbles of Temer’s administration. Business confidence has spiked from record lows to its highest level since 2014. Meantime slowing inflation has the market betting the central bank will find space to lower interest rates before year-end.

Output of capital goods, a barometer of investment, rose 1.5 percent in May, its fifth straight month of gains. Production of consumer durable goods climbed 5.6 percent after a 4.1 percent decline in the previous month.

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