CNI: Brazil construction confidence index slumps in September
RIO DE JANEIRO, BRAZIL – The Industrial Entrepreneur Confidence Index (ICEI) of the construction industry recorded a sharp drop in September, down 5 points compared to August, reported yesterday the Brazilian National Confederation of Industry (CNI).
This month, the index stood at 54.7, its largest slump since March 2021. The index ranges from 0 to 100 points. Values over 50 points show confidence in the industry sector and the higher it is over 50 points, the greater and more widespread is business confidence. The closer to 0, the lower the confidence.
“Between August and September, the current conditions index for the Brazilian economy retreated from 51.3 to 42.3 points. By falling below the 50-point cut-off line, the index reflects a transition from a positive to a negative perception of the Brazilian economy. The index of expectations of the Brazilian economy also fell sharply, by 8 points, but remains above the 50-point cut-off line,” the Confederation reported.
CNI said that the September result was marked by a deterioration in the perception of current conditions and expectations regarding the Brazilian economy. Also according to the Confederation, in line with the drop in confidence, entrepreneurs’ expectations of the construction industry with respect to the variables related to the activity also fell, albeit to a lesser extent.
According to the survey, the expectations of the level of activity, new ventures, purchase of inputs and raw materials and the number of employees fell by 1.3 points, 0.9 points, 0.8 points and 1.0 points, respectively. Consequently, these indexes stood at 56.4 points, 55.4 points, 55.1 points, and 53.4 points, respectively in the month of September.
“Despite the drop, all expectation indexes are above the 50-point line, suggesting that entrepreneurs expect these variables to grow over the next 6 months,” CNI said.
Investment intentions index was another construction industry index that dropped in the month, down 4.2 points to 41.2. This is the index’s largest drop in a single month since April 2020.
Despite the drop, CNI reported that the index is still higher than its historical average, which is 35.2 points, “indicating that although the intention to invest is lower than in August, it is still higher than the intention to invest observed in recent years.”
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