CNI: U.S. Tariffs Disrupt Brazil’s Export Outlook, Job Growth
(MENAFN) A sharp warning from Brazil's National Confederation of Industry (CNI) signals that fresh U.S. trade tariffs could derail nearly two years of export momentum, disrupt industrial employment, and dampen investment across Latin America’s largest economy.
In its report released Wednesday, the CNI revealed that U.S.-imposed duties—a 50% tariff that came into effect on August 6—have already begun to take a toll on Brazil’s manufacturing sector.
Export expectations for the next six months fell sharply in August, with the CNI's index dropping 5.1 points to 46.6. The gauge, where readings below 50 indicate a projected decline, now suggests Brazil could see its first export contraction in 21 months.
"The worsening of export expectations is closely related to uncertainties in the external environment, mainly due to the new U.S. trade policy," said Isabella Bianchi, policy and industry analyst at CNI.
Beyond exports, job prospects within Brazil’s industrial sector are also under pressure. Despite a rise in production in July, employment slipped—pointing to mounting strain on the labor market. The employment expectations index dipped to 49.3 in August, suggesting companies do not foresee hiring gains in the near term.
Investor confidence is also retreating. "The investment intention index fell to 54.6 points, the lowest level since October 2023. However, it remains 2.1 points above the historical average of 52.5 points," the report noted.
The downturn comes amid increasing global trade tensions, with Brazil now caught in the crosshairs of evolving U.S. economic strategy.
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