Brazil's Industry Struggles As High Interest Rates Hurt Confidence

(MENAFN- The Rio Times) Brazil's main industry group, the National Confederation of Industry (CNI), just released new data showing industrial companies remain worried in 2025.

The Industrial Confidence Index (ICEI) fell to 48.6 in June, below the neutral 50-point mark for the sixth month.

This means most factory owners and managers do not feel good about business now or in the near future.

CNI surveyed 1,766 companies of all sizes. Small firms scored 47.4, medium firms 48.5, and large firms 49.7 on the index-all below 50.

That shows weak confidence everywhere, with large companies seeing the biggest drop from last month.

Most sectors-21 out of 29-feel pessimistic. Only seven sectors feel positive, and one is neutral. Some areas like personal care and cleaning improved, but the beverage sector lost confidence.


Brazil's Industry Struggles as High Interest Rates Hurt Confidence
Regionally, the North and Northeast show optimism, with scores above 52. The South, Southeast, and Center-West remain negative, with scores below 49.

The Center-West saw the sharpest decline, dropping over two points in a month. The main reason for this gloom is high interest rates.

Brazil's central bank has kept rates at about 14-15 percent since late 2024 to fight inflation.

This makes loans expensive, so companies invest and hire less. Small and medium firms suffer most, as they have less access to credit and weaker sales.

Industry makes up about 21 percent of Brazil's economy. When factories and plants slow down, fewer people get jobs, and the whole economy feels the pain.

The CNI's report shows that until borrowing becomes cheaper and confidence returns, Brazil's industry will likely stay cautious, slowing growth for everyone.

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