Anfavea Mai/12: -7.7%y/y (previous:
First thoughts: The auto vehicles production remains weak, as expected. Considering
the seasonal adjusted data (using the same industrial production method) the
vehicles production decreased 2.2%m/m for the second month in a row. In others
words, if the second quarter would have finished in May, the second quarter
would have decreased 1%q/q. We already expected a poor performance of the auto
production due to the rise in the inventories registered in the 1Q. This will
affect the performance of the total industrial production in May - it is worth
noting that the auto sector is a relevant segment in the Brazilian industry,
weighting 10% but probably affecting 20% of the total production through its
impact into the whole industrial chain.
the May´s auto result is suggesting that the industrial production is going to
register another decline at margin (probably close to -1%m/m).
Bottom line: This result added to the still weak global demand and
competitiveness barriers suggests that the industrial production remains weak
and, differently to the 1Q, it will likely to not contribute positively in the
2Q GDP accounts. On the other hand, we understand that the recently
government measures can help the auto industry from June onward; additionally,
we do not expect the industry to contribute negatively (despite still poor) to
GDP from 3Q12 due to: (1) the conclusion of the inventory adjustment, (2) the
still strong consumption performance and (3) the lagged and cumulative effects
of monetary policy.