Brazil's industrial output unchanged in June despite COVID - 19 pandemic

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BRASILIA, Aug 3 - Industrial production in Brazil was unchanged from the previous month, figures showed on Tuesday, meaning that the sector expanded 12.9% in the first half of the year to stand slightly bigger than it was just before the COVID - 19 pandemic.

However, statistics agency IBGE said that data in June in three of the four main economic categories and in 14 of 26 sectors surveyed, showing the underlying figures were weaker than the stability show in the headline number.

The period of no change on the month was exactly as predicted in a Reuters poll of economists, while the 12.0% increase from June last year was slightly higher than the 11.8% growth forecast in the poll.

IBGE survey manager Andre Macedo said the effects of the second wave of the pandemic are still being felt across the sector.

In the industrial sector there are several challenges caused by restriction measures, such as higher production, the difficulty in obtaining raw materials and rising production costs, Macedo said, adding that high unemployment is also affecting demand.

IBGE said 14 of 26 sectors surveyed saw a fall in output in June, the largest drag being a 3.8% reduction in auto vehicles and parts production.

In June only one of the four major categories - capital goods - saw output rise, IBGE said.

Compared to June last year, the total production rose 12.0% due to base effects. IOGE figures show, however, that the industrial sector is still 16.7% smaller than its peak in May 2011.