UPDATE 1-Brazil industrial output plunges 8 percent in 2015
(Adds table, 2015 result, background) By Silvio Cascione BRASILIA, Feb 2 (Reuters) - Industrial output in Brazil fell for a seventh straight month in December, capping the worst year for manufacturers in more than a decade as they struggle with inflation, high interest rates and political uncertainty. Output at factories and mines plunged 8.3 percent in 2015, statistics agency IBGE said on Tuesday, the worst performance since the data series started in 2003. Production fell 0.7 percent in December from November after seasonal adjustments. Economists in a Reuters poll expected output to remain stable. Manufacturers and miners cut nearly one fifth of their production since a 2013 peak after Brazil fell into a deep recession. Economists in a weekly central bank poll expect industrial output to slip 4 percent this year. Production of capital goods fell 25.5 percent in 2015, 8.2 percent in December alone, as climbing interest rates discouraged investment in machinery. Brazil's benchmark interest rates are at a nine-year high of 14.25 percent. Production of consumer goods also suffered as unemployment and inflation curbed demand. More than 1.5 million jobs disappeared last year. Latin America's largest economy nosedived after a ballooning budget deficit prompted President Dilma Rousseff and the central bank to raise taxes, cut spending and jack up interest rates last year. The economy has also been dragged down by a massive corruption scandal at state-run oil firm Petroleo Brasileiro SA , one of the country's largest companies, as it struggled with a drop in global oil prices. Executives from top construction and engineering companies are under investigation or in jail. Industrial production in December retreated 11.9 percent from a year earlier. (Percent change) m-m y-y Capital goods -8.2 -31.9 Intermediate goods 0.7 -11.4 Consumer goods 1.0 -8.4 Durable consumer goods 9.4 -24.7 Semi-durable and non-durable consumer 0.3 -4.2 goods Industrial output -0.7 -11.9 (Reporting by Silvio Cascione Editing by W Simon)
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