Brazil: Industrial business sentiment rises in December
Latest reading: The seasonally adjusted industrial business confidence index published by the Getúlio Vargas Foundation (Fundação Getúlio Vargas) increased to 92.9 in December, following November’s 89.1. As such, the index moved closer to, but remained below, the 100-point threshold, signaling continued pessimism among industrial firms.
In December, industrial businesses grew less pessimistic about expectations for the coming months (+93.4 vs +88.8 in November) and the current situation (+92.4 vs +89.6 in November). Industrial firms’ sentiment is still suffering from the hit to economic activity from a tight monetary policy stance.
Outlook: In October–December, industrial business sentiment hit a multi-year low, boding ill for investment in the quarter; in the coming months, elevated interest rates will likely continue to restrain industrial sentiment. Changes in U.S. tariffs on Brazilian goods remain a key factor to monitor.