The latest data on Brazil’s industrial production on Friday showed deepening recession in Latin America’s biggest economy, though its trade surplus grew and the currency is rising on prospects of a new government.
Industrial output shrank 9% over the 12 months leading up to February, government statistics showed, with the car-making, machinery and electronic sectors hit the hardest, AFP reported.
The slide appeared to be accelerating with February production 2.5% lower than in January.
Exports also slid by 6% in March compared to the same month last year, according to the trade ministry.
But that was far overshadowed by a plunge in imports which were down 30%.
That fall was partly due to lower costs for shipped-in fuel—but also because Brazil’s belt-tightening population was cutting back on purchases of foreign goods.
The result was the country’s biggest monthly trade surplus in 28 years, hailed by the government as a rare spot of good news.
The national currency, the real, has also risen by 9.5% over the past month, and posted a further 0.98% gain on Friday, the first day of April.
That, however, has not made up for the ground lost in its 33% dive against the dollar in 2015.
The uptick reflected investors’ hopes that a change of government may soon occur as unpopular and beleaguered President Dilma Rousseff struggles to stave off impeachment.
The recession in Brazil, the seventh-biggest economy in the world, shows little sign of respite. After contracting 3.8% last year, the economy is expected to shrink by another 3.6% this year.
