The performance of industry was negative from September to October, with a drop in activity, employment and the use of installed capacity. The data is from search Industrial survey, released today (18), in Brasília, by the National Confederation of Industry (CNI).
It is the second consecutive decline in industrial production. The production evolution index remained below 50 points, falling from 49 points to 48.5 points. Values above the 50-point dividing line indicate an increase in industrial production and below the cut-off line, a fall. “It is the first drop in industrial production for the month of October since 2016,” said the CNI.
Employment in the industrial sector also fell after five consecutive months of growth. The employment evolution index went from 51.4 points to 49.6 points indicating a cut. It is the first decline in industrial employment for an October since 2019.
Likewise, the Installed Capacity Utilization Index (UCI) recorded the second consecutive decline and ended October at 71%. In the last two months, the UCI has accumulated a drop of two percentage points.
falling expectations
According to the CNI, all the expectations of the industrial sector in November “reduced strongly”. “It is the first time in more than two years that there is an expectation of decline in industrial employment and exports for the next six months”, explained the entity. “There is even less optimism regarding the purchase of raw materials and the level of demand,” he said.
The inventory level evolution index increased to 51.5 points in October. Above the 50-point dividing line, the index points to an increase in stocks compared to September. The index of actual inventory in relation to planned moved away from the dividing line of 50 points, rising from 50.9 points to 52.4 points between September and October.
The CNI also explained that the result puts inventories in the industrial sector at the highest level above planned since July 2019, “with an indication of frustration among entrepreneurs with the level of consumption”.
For the entity, businessmen’s expectations are already contaminated with demand lower than production, which are already in a scenario of falling activity.
The investment intention index fell 3.9 points to 53.5 points. It is the lowest level since August 2020.
The CNI consulted 1,757 companies between November 1st and 10th, of which 703 were small companies, 615 medium-sized companies and 439 large companies.
