Weekly Report - 8 February 2007

BRAZIL | Industrial production up. Industrial production was up 2.8% in 2006 year-on-year. The result, however, was the lowest since 2003. In 2005 Brazil's industry expanded by 3.1% and in 2004 by 8.3% year-on-year. According to the official statistics agency, the Ibge, the main factor for last year's less than impressive result has been the strengthening of the Real against the US dollar, which led to Brazilian industrial goods losing competitiveness while at the same time increasing demand for imported goods. Industrial sales rose 1.72% in 2006 year-on-year.