Industry production in the country fell 0.2% from June to July. With this result, the sector reaches four months in a row without growth, which is explained by the high interest environment.
The result was released on Wednesday (3) by Monthly industrial researchfrom the Brazilian Institute of Geography and Statistics (IBGE).
From April to July, the industry accumulates loss of 1.5%, falling in April (-0.7%) and May (-0.6%) and stability in June (0%). The last time the Brazilian industrial park totaled four months without expansion was between November 2022 and February 2023.
Compared to July 2024, the production of the national industry shows an advance of 0.2%. In the last 12 months, the sector has a 1.9%expansion.
The July result leaves the sector 1.7% above the covid-19 pre-pound (February 2020) and 15.3% below the record level already reached, May 2011.
Regarding the final level of 2024, the sector expanded 0.3%.
HIGH INTEREST EFFECT
According to research manager André Macedo, the negative predominant scenario since April is explained by restrictive monetary policy, ie high interest rates, central bank tool (BC) to try to contain inflation.
“In conjunctural terms, the effects of a more restrictive monetary policy-which makes credit, increases default and negatively affect consumer decisions and investments. These factors have contributed to limit the pace of growth in industrial production in the period, reflecting more moderate results against previous months,” says Macedo.
Currently, the basic interest rate, Selic, has been at 15% per year, the highest level since July 2006. High interest rates have the effect of discouraging consumption and investment to cool the economy and decrease the demand for goods and services, consequently, taking force from inflation.
In July, the official inflationmeasured by the National Consumer Price Index (IPCA), showed a 5.23%accumulation in 12 months, outside the government’s goal – 3%, with tolerance of 1.5 percentage points to more or less, ie up to 4.5%.
The rate has been above the ceiling since September 2024 (4.42%). In April, it reached 5.53%, the highest point ever since.
Sectors
From June to July, IBGE identified a drop in 13 of the 25 industrial activities. The negative highlights were:
– Metallurgy (- 2.3%)
– Other transportation equipment (-5.3%)
– Record printing and reproduction (-11.3%)
– Drinks (-2.2%)
– Maintenance, repair and installation of machinery and equipment (-3.7%)
– Computer equipment, electronic and optical products (-2%)
– Miscellaneous Products (-3.5%)
– Rubber and plastic material products (-1%)
Among production high activities, the main positive impacts came from pharmochemical and pharmaceuticals (7.9%), food (1.1%), extractive industries (0.8%) and chemicals (1.8%).
Regarding the large categories, durable consumer goods (-0.5%) and capital goods (-0.2%) recorded highs in June to July. Capital goods are machinery and equipment.
On the other hand, intermediate goods, that is, which will be transformed into other products, grew 0.5% and semi and non -durable consumer goods increased by 0.1%.
Tariff
According to André Macedo, the result of July also had reflexes from the American tariffwhich only started in the first week of August. This is explained by the fact that the threat of taxation of Brazilian exports to the United States has moved expectations and future decisions of entrepreneurs, especially those who have activities aimed at the foreign market.
Macedo points out that the negative predominance since April is based on interest policy.
“Within the general result, [o tarifaço] It is not very important at the moment, ”he said.
