Brazil: Manufacturing PMI hits three-month high in July
The S&P Global Brazil Manufacturing Purchasing Managers’ Index (PMI) rose to a three-month high of 54.0 in July from 52.5 in June. As a result, the index moved further above the 50.0 no-change threshold, signaling a faster improvement in manufacturing-sector operating conditions compared to the previous month.
July’s upturn was driven by a significant improvement in demand conditions, which led to an increase in new orders and output, with input buying reaching the fastest rate in three months. This uptick in demand also spurred quicker job creation. The depreciation of the currency boosted the competitiveness of Brazilian goods internationally—evidenced by the steepest upturn in new export orders since December 2021.
Regarding prices, the rate of cost inflation accelerated due to higher prices for chemicals, foodstuffs, fuel, metals and paper. In response, manufacturers raised their selling prices at a stronger pace; both metrics were the highest in two years. Looking ahead, firms remained optimistic despite inflationary challenges.