In July 2008, the industrial production increased by 1.0% compared to June, in the series with seasonal adjustment, after increasing by 2.9% in the previous month. ...

In July 2008, the industrial production increased by 1.0% compared to June, in the series with seasonal adjustment, after increasing by 2.9% in the previous month.  In relation to July 2007, the increase was of 8.5%, completing a sequence of 25 months with positive results in this type of index.  The performance of the month brought the index accumulated in the first seven months of the year to a rate of 6.6%, above the one observed in the end of the first semester (6.2%).   The index accumulated in the last twelve months changed from 6.7% in June to 6.8% in July.

The increase of 1.0% observed from June to July showed the increases in 17 among 27 activities and was concentrated in two among four categories of use.  Among the industrial segments stood out other chemical products (4.2%), which accumulated 12.2% in three months of expansion. Edition and printing (5.6%), machines and equipment (2.0%) and tobacco (12.9%) also presented important results.  On the other hand, the most significant negative influences on the overall average came from electronic material and communication equipment (-7.6%), automotive vehicles (-1.2%), beverages (-3.0%) and other transportation equipment (-3.4%).  It is worth observing the positive performance in the previous month of all these sectors: 4.1%, 9.7%, 2.8% and 6.0%, respectively.

Also in the comparison with the previous month, the indexes by categories of use showed a major dynamism in capital goods (1.2%) and in intermediate goods (1.1%), which reached in July the highest levels of the time series.  The category durable consumer goods (-5.2%) had decrease, after increasing by 7.7% in June, while semi and non-durable consumer goods was stable (0.0%), after two months of expansion, a period in which it accumulated gain of 2.6%.

The performance of July stressed the trend of growth of the quarterly moving average indexes, with the quarter closed in July surpassing in 1.1% the level of June, major rhythm of increment since October  2007 (1.5%).  Capital and intermediate goods (both with 1.4%) maintained growth above the average of industry, while semi and non-durable consumer goods (0.9%) and durable consumer goods (0.2%) had a more moderate growth.

The result of 8.5% in the monthly index (July 2008/July 2007) showed the growth of the majority (23) of the twenty-seven sectors surveyed.  It is worth mentioning that July 2008 had one more working than July 2007.  The industry of automotive vehicles (17.3%) continued in the leadership of expansion, bringing the major influence on the overall rate, followed by: machines and equipment (12.5%) and basic metallurgy (10.0%).  In these three sectors, the items which stood out were respectively automobiles and trucks; equipment elevators/ merchandise transporters; valves, taps and registers; and rolled steel products and steel plates, ingots and blocks.  In relation to July 2007, the four activities which had decrease were, by order of importance: wood (-13.7%), electronic material and communication equipment (-3.2%), perfumery, soaps and cleaning products (-4.8%) and footwear and leather articles (-1.9%), due, mainly, to the decrease in the production of sawed wood, television sets, soaps for domestic use and leather footwear, respectively.

Also in the comparison July 08/ July 07, the indexes by categories of use confirmed the generalized profile of positive results in the industrial production, with the four categories registering growth in this period.  Capital goods (22.3%) and durable consumer  goods (9.8%) were above the overall average (8.5%) and intermediate goods and semi and non-durable consumer goods brought rates of 7.5% and 5.0%, respectively.  The production of capital goods was positively influenced by the two-digit increases in all its sub-sectors, especially capital goods for transportation (32.8%), followed by capital goods for mixed use (15.4%) and capital goods for industrial use (15.5%).  The performance of durable consumer goods was supported, mainly, by the performance of automotive vehicles (16.7%), sector which increases since March 2007.

The increase of 7.5% in the production of intermediate goods was supported, mainly, by the items associated to basic metallurgy (10.0%), mining and quarrying (8.6%), other chemical products (7.8%) and non-metallic minerals (10.5%).  In these sectors, stood out, respectively, the items metallurgy products, iron ores, herbicides, and cement.  It is also worth mentioning the contribution which came from inputs for construction with growth of 14.4%, best result since July 1996 (16.8%).  The production of semi and non-durable consumer goods (5.0%) was supported, mainly, by the good performance of fuels (13.5%) and other non-durable (4.1%), influenced by the hike in the production of alcohol and medicines.

In January-July, compared to the same period of 2007, the total growth of industry was 6.6%, with 22 activities having increase in the production.  The manufacturing of automotive vehicles (18.4%) stood out.  Other relevant positive contributions came from machines and equipment (10.0%), other transportation equipment (32.5%) and basic metallurgy (7.9%).  On the other hand, among the four industries with decrease, the ones which most influenced the overall rate were tobacco (-7.7%) and wood (-6.4%).

By categories of use, the segments of capital goods (18.1%) and durable consumer goods (13.3%) led the expansion, while intermediate goods (5.6%) and semi and non-durable consumer goods (2.1%) had results below the industrial average.  These numbers showed the dynamism of the cycle of investments and of domestic consumption which were encouraged mainly by the good credit conditions.

In summary, the numbers of July showed that the trend of growth of the industrial production was maintained, as a consequence of the performance of capital goods and intermediate goods, both with expansion of 1.4%, according to the quarterly moving average index.  Besides the export of commodities, the industry of intermediate goods was positively influenced by the favorable performance of agriculture industry and more recently, by the increase in the rhythm of production of construction, which has a demand for industrial products basically provided by the domestic market.