Bank of America analysts report that Brazil’s industrial production climbed 0.1% in March on a seasonally adjusted monthly basis, marking a clear slowdown from February’s 0.9% expansion but outperforming forecasts that had expected a 0.9% contraction.
On an annual basis, industrial output expanded 4.3% in March, reversing a 0.7% decline recorded the prior month. Bank of America cautioned that part of the strong year-over-year comparison was mechanical: March 2026 contained three more business days than March 2025, which partially inflated the annual growth rate.
Momentum in the industrial series accelerated to 1.0% in March from 0.3% in February. All four principal industrial categories contributed to the monthly advance. Capital goods rose 0.6%, intermediate goods increased 0.5%, and consumption goods gained 0.5% for the month.
Within the consumption goods grouping, durables saw the largest monthly increase at 1.7%, while semi and non-durables expanded 0.4%. Sector-level leaders in March were oil products and biofuels, which rose 2.2% month-on-month, followed by chemical products at 4.0% and automotive and auto parts at 1.1%.
Bank of America linked the relative strength in the automotive segment to resilient vehicle sales that were underpinned by a robust labor market, noting that this support helped the auto value chain outperform many other activities.
Out of 25 tracked activities, nine recorded seasonally adjusted monthly growth in March. The diffusion index, which measures the share of products with year-on-year production gains, climbed to 55.6% from 36.2% in February, indicating a broader proportion of industries showing positive annual performance.
Despite the encouraging monthly and annual prints, Bank of America held to its economic outlook for Brazil: gross domestic product is forecast to grow 2.3% in 2026 and 2.0% in 2027. The bank expects overall activity to decelerate as restrictive monetary policy exerts a drag on the economy.
Methodological note: The analysts highlighted that calendar effects can materially influence year-on-year comparisons when the number of business days differs across periods.