Brazil's Industrial Output Drops 0.8% in September

Brazil's national industry recorded a 0.8% decline in September compared to the previous month. This data confirms a downward trend lasting five months and represents a cumulative loss of 4.1% during that period. The result came in below financial market projections.

The IBGE survey shows that 17 out of 25 industrial sectors performed poorly. The manufacturing of coal and petroleum derivatives, along with biofuels, led the losses with a 4.2% drop. Food production also fell 1.7% due to the impact of heavy rains on sugarcane processing.

The capital goods sector posted the largest decline among economic categories with a 1.9% decrease. Conversely, the extractive industry rose 1.7% driven by a higher supply of iron ore, natural gas, and crude oil. The current level of production remains 16.5% below the all-time high recorded in 2011.

In a year-over-year comparison, industry output contracted 2.5% against September of the previous year. IBGE noted that a calendar with fewer business days and a high base of comparison contributed to this result. Despite recent declines, the year-to-date figure for 2026 still maintains a residual growth of 0.4%.

Persistent weakness in industrial production may reduce short-term inflationary pressures. This influences market sentiment regarding the future of the benchmark interest rate and the performance of the Ibovespa.