Brazil's industry has growth in July, with reopening of the economy

Brazil's manufacturing sector recorded record growth in July, in the face of a sharp rise in new orders after the economic reopening, according to the Purchasing Managers' Index (PMI) survey released on Monday.
The Brazilian industry PMI calculated by IHS Markit jumped to 58.2 in July from 51.6 in June, above the 50 mark (which separates growth from contraction) for the second month and reaching the highest level in the history of the survey, started in February 2006
"A record expansion of the Brazilian manufacturing economy in July helped to close the considerable gap that emerged in production, when compared to the levels observed before the intensification of Covid-19," said Paul Smith, Director of Economics at IHS Markit.
"However, with Covid-19 still prevailing and continuing to have a significant and negative impact on global trade, there are still many negative risks for the future," he added.
According to IHS Markit, demand has strengthened in line with the continued reopening of the economy after coronavirus pandemic-related outages.
The highlight was domestic demand, which led to the second largest increase in new orders recorded so far, second only to the movement seen in January 2010.
On the other hand, export demand continued to weaken, with sales to foreign customers falling for the 11th month in a row. Still, the increase in new total orders led to the largest growth in manufacturing production ever recorded.
The industry's capacity came under pressure in the month, as shown by the first increase in pending orders in four months, at the strongest high in more than two years.
The result was job increases in the sector for the first time in five months and at the best pace since September 2019.
With this scenario, confidence about the future recorded the best result of 2020 so far. More than 80% of respondents indicated positive growth expectations, with companies anticipating continued recovery in demand and sales over the next 12 months.
The contrast was to price trends, with input cost inflation reaching the highest level of research records, in view of rising metal prices, as well as unfavorable exchange rates and cost increases with suppliers due to shortages of inventories.
As a result, the prices charged were also high at a record pace.