Thursday, July 5, 2007

Brazil Industrial Output

Bloomberg today:

Brazilian Industrial Output Rises 4.9 Percent in May (Update1)

July 4 (Bloomberg) -- Brazil's industrial output climbed in May as lower interest rates helped cut financing costs and boosted production of machinery and cars.

Output increased 4.9 percent from a year earlier, compared with a gain of 6 percent in April, the national statistics agency said in a statement released in Rio de Janeiro today. The increase exceeded the median estimate of 3.5 percent by 23 economists in a Bloomberg survey.

Brazil's central bank lowered the benchmark lending rate for a 16th straight time on June 6 to 12 percent from 19.75 percent in September 2005. Lower rates helped spur a 19.4 percent increase in production of capital goods from a year ago and raised durable goods output by 6 percent, the agency said.

``Some industries are benefiting from lower credit and managed to boost production,'' Edgard Pereira, an economist with Brazilian Research Institute for Industry Development, said in an interview in Sao Paulo. ``The increase in the production of capital goods reduces inflationary pressure.''

The central bank on June 28 cut its estimate for inflation this year to 3.5 percent from 3.8 percent and raised its forecast for economic growth to 4.7 percent from 4.1 percent.

After stripping out seasonal factors, output climbed 1.3 percent in May from April, the agency said. The gain was more than the median 0.3 percent rise forecast in the Bloomberg survey.

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