SAO PAULO--Brazil's manufacturing sector dropped in March, for the second-consecutive month, pointing to a moderate economy recovery for Latin America's largest economy this year, according to a survey published Monday.
The purchasing managers' index, or PMI, dropped to 51.8 from 52.5 in the previous month, according to the survey prepared by Markit for international bank HSBC.
"The PMI survey suggests that economic activity in the manufacturing sector lost momentum after a very strong January (when the PMI had reached 53.2). On the other hand, the average reading for the first quarter of the year was still a solid 52.5--the strongest since 2011Q1 (first quarter of 2011). These results seem consistent with our view that the Brazilian economy is experiencing a moderate recovery in 2013." Andre Loes, chief economist for Brazil at HSBC, said in a statement.
Brazil's economy expanded just 0.9% in 2012, and it is expected to grow around 3% this year.
Over the weekend, the Brazilian government extended a tax cut on automotive purchases to the end of this year as part of its effort to fuel the domestic economy and also contain inflationary pressures. The tax cut was previously expected to end Monday. The country's lackluster economic performance last year was attributed mainly to tepid industrial production. The auto industry, including auto parts, represents around 25% of the industry in Brazil.
(END) Dow Jones Newswires
April 01, 2013 10:17 ET (14:17 GMT)
The purchasing managers' index, or PMI, dropped to 51.8 from 52.5 in the previous month, according to the survey prepared by Markit for international bank HSBC.
"The PMI survey suggests that economic activity in the manufacturing sector lost momentum after a very strong January (when the PMI had reached 53.2). On the other hand, the average reading for the first quarter of the year was still a solid 52.5--the strongest since 2011Q1 (first quarter of 2011). These results seem consistent with our view that the Brazilian economy is experiencing a moderate recovery in 2013." Andre Loes, chief economist for Brazil at HSBC, said in a statement.
Brazil's economy expanded just 0.9% in 2012, and it is expected to grow around 3% this year.
Over the weekend, the Brazilian government extended a tax cut on automotive purchases to the end of this year as part of its effort to fuel the domestic economy and also contain inflationary pressures. The tax cut was previously expected to end Monday. The country's lackluster economic performance last year was attributed mainly to tepid industrial production. The auto industry, including auto parts, represents around 25% of the industry in Brazil.
(END) Dow Jones Newswires
April 01, 2013 10:17 ET (14:17 GMT)
