The Minas Gerais Industrial Survey, verified by FIEMG, once again shows production progress in July. The survey also points to growth in the number of employees for the sixth consecutive month. Ending the seventh month of the year with inventories lower than planned, industrial entrepreneurs reveal, according to the survey, more optimism in relation to demand, purchase of raw materials and employment in the next six months.
What contributes to this optimism of industrialists, defines economist Daniela Muniz, from the Management of Business Economics and Finance at FIEMG, is the good performance of the activity in recent months and the fiscal and economic stimuli granted by the government.

The study indicates that the use of installed capacity remained below the usual for May, but was above its historical average. Industries showed lower-than-planned inventory levels, suggesting that demand for their products was higher than expected by businessmen. The normalization of activities, with the cooling of the Covid-19 health crisis, explains the maintenance of optimism by entrepreneurs.

Macroeconomic environment

Additionally, the improvement in the labor market and the federal government's measures to stimulate the economy, notably the increase in the value of social benefits and the exemption of items such as fuel and energy, contribute to this optimism. However, the macroeconomic environment remains challenging, in a context of continuing bottlenecks associated with the lack of inputs for the industry and high inflation and interest rates, as well as great political uncertainty, due to the proximity of the elections.

The production evolution index increased by 2.8 points between June (47.6 points) and July (50.4 points). When surpassing the barrier of 50 points - border between fall and rise - the indicator showed growth in production. On the other hand, the index dropped 5.1 points compared to July 2021 (55.5 points), the lowest for the month in six years.