Brazil's manufacturing sector faced significant challenges in August, with the S&P Global Brazil Manufacturing PMI recording its lowest reading in the year-to-date at 50.4, a sharp drop from July's 54.0. It was was only just above the 50.0 no-change mark, the survey added. The sector experienced its first production contraction of the year, driven by fading demand and the sharpest rise in input costs since March 2022. "The Brazilian manufacturing sector suffered a loss of momentum in August, with surging cost pressures hampering firms' ability to secure new business. Manufacturers even took the step of scaling back production and softened the pace of hiring in a bid to limit costs." said Pollyanna De Lima, Economics Associate Director at S&P Global Market Intelligence. New orders grew at their slowest pace in eight months, and companies reduced output and hiring to manage costs. Despite the setbacks, manufacturers remained optimistic, supported by plans for plant expansion, product diversification, and investment. "Firms will be hoping for an improvement in the real exchange rate soon to help relieve some of the pressure on costs and lead to a revitalisation of growth in the months ahead." De Lima added. Attribution: S&P Global Brazil Manufacturing PMI® Subediting: Y.Yasser
