LatinNews Daily Report - 05 December 2012

ECONOMY | Industrial production perks up. The index of industrial production (IP) compiled by the national statistics institute (Ibge) broke a 13 month-long negative cycle in October by posting its first annualised growth since August 2011, lifting hopes of a gradual recovery.  The index rose 2.3% year-on-year and 0.9% month-on-month in October and has now risen on a month-on-month basis in four of the past five months.  Of the 27 industrial sectors surveyed by the Ibge, 13 registered month-on-month growth, including automotives (which accounts for 20% of the total industrial park), machinery and equipment and extractive industries like mining. The other 14, including pharmaceuticals, IT equipment and clothing, continued to contract. The Ibge noted that the monthly result was affected by the fact that there were 22 working days in October, compared with only 19 in September.  Nevertheless, the mood in the sector is one of cautious optimism that the worst is over. Finance Minister Guido Mantega yesterday announced cuts in payroll taxes and other contributions as well as new credit lines for the construction sector and said that (yet another) official stimulus package is in the offing.

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