Industry in Brazil has expanded the most in almost seven years in November and optimism improves, shows PMI

© Reuters. Visão geral de planta petroquímica em Cubatão, São Paulo

Strong new business inflows accelerated Brazil's industrial activity expansion to the highest level in almost seven years in November, improving manufacturers' optimism for next year, according to the PMI survey, ) released on Friday.

IHS Markit reported that the PMI of the Brazilian industry advanced in November to 53.5, from 51.2 in October, "indicating a robust improvement in the sector's health." Reading above 50 indicates activity expansion.

Growth was registered in all three categories, with a notable performance among consumer goods.

The sharp recovery in new order volumes in nearly seven years underpinned industry expansion last month, with the contribution even from overseas markets.

As a result, production volume expanded at the strongest pace in almost five years, with companies responding to strong demand. This has led to hiring of staff, but at a modest rate.

At the same time, manufacturers bought inputs in November at the strongest pace since January 2013. Cost inflation reached a 17-month peak in November boosted by energy and basic commodities, which pushed prices up to the highest level. high since February.

IHS Markit also noted that manufacturers are projecting new economic improvements, new customer wins and product diversification, which has boosted optimism over production for the coming year. Thus, the level of optimism registered was the second highest since the beginning of 2012.