RIO DE JANEIRO (Dow Jones)--Brazil's industrial output gathered pace in February, beating analysts' estimates as production of food and vehicles as steamed ahead in Latin America's largest economy.
Output at Brazil's factories increased a seasonally adjusted 1.9% from January and picked up 6.9% compared with February 2010, the Brazilian Census Bureau, or IBGE, said Friday. February was the second consecutive month of rising output, after January's increase of 0.2%, which followed a slackening in output in late 2010 when some industrial sectors wrestled with high import levels.
February's increase was well above the median estimate of a rise of 1.00% from 27 analysts polled by the local Estado news agency. The projections ranged between a rise of 0.50% and an expansion of 1.70%. The analysts had predicted a year-on-year advance of of 5.35%.
The month's strong result was attributed in part to the fact that Carnival, a major holiday in Brazil, fell in March this year, boosting the number of working days in February. Carnival falls in March only once every five years.
The IBGE reported the month's highlights were a 6.7% leap in food output and a 4.7% advance in vehicle output. Of the 27 sectors surveyed, 17 reported higher output, it said.
In the 12 months ended in February, Brazil's industrial output expanded 8.6%.
The IBGE revised downwards January 2011's production to a 2.4% increase over January 2010, from the previously-stated 2.5% increase.
February's rise in industrial production, following January's uptick, looks set to continue to apply pressures on Brazil's Central Bank to consider further increases in interest rates given current inflationary pressures.
Earlier this week the Brazilian Central Bank indicated that inflation is unlikely to converge on the government's 4.5% year-end target until 2012.
This outlook reinforces the possibility of the bank raising the benchmark Selic base interest rate by a half-percentage point to 12.25% this month, as expected by analysts. The Selic currently stands at 11.75%, the highest interest rate of any major economy.
Brazilian gross domestic product expanded 7.5% in 2010 as the economy rebounded from recession. This recovery was aided by government tax breaks for consumer goods, most of which have lapsed.
Source: http://online.wsj.com
Output at Brazil's factories increased a seasonally adjusted 1.9% from January and picked up 6.9% compared with February 2010, the Brazilian Census Bureau, or IBGE, said Friday. February was the second consecutive month of rising output, after January's increase of 0.2%, which followed a slackening in output in late 2010 when some industrial sectors wrestled with high import levels.
February's increase was well above the median estimate of a rise of 1.00% from 27 analysts polled by the local Estado news agency. The projections ranged between a rise of 0.50% and an expansion of 1.70%. The analysts had predicted a year-on-year advance of of 5.35%.
The month's strong result was attributed in part to the fact that Carnival, a major holiday in Brazil, fell in March this year, boosting the number of working days in February. Carnival falls in March only once every five years.
The IBGE reported the month's highlights were a 6.7% leap in food output and a 4.7% advance in vehicle output. Of the 27 sectors surveyed, 17 reported higher output, it said.
In the 12 months ended in February, Brazil's industrial output expanded 8.6%.
The IBGE revised downwards January 2011's production to a 2.4% increase over January 2010, from the previously-stated 2.5% increase.
February's rise in industrial production, following January's uptick, looks set to continue to apply pressures on Brazil's Central Bank to consider further increases in interest rates given current inflationary pressures.
Earlier this week the Brazilian Central Bank indicated that inflation is unlikely to converge on the government's 4.5% year-end target until 2012.
This outlook reinforces the possibility of the bank raising the benchmark Selic base interest rate by a half-percentage point to 12.25% this month, as expected by analysts. The Selic currently stands at 11.75%, the highest interest rate of any major economy.
Brazilian gross domestic product expanded 7.5% in 2010 as the economy rebounded from recession. This recovery was aided by government tax breaks for consumer goods, most of which have lapsed.
Source: http://online.wsj.com
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