Brazil's manufacturing activity weakens in August: PMI

September 1, 2016 9:08 AM EDT

A technician works on a plane on the assembly line of Embraer's E-Jet family of commercial planes at their factory in Sao Jose dos Campos, October 16, 2014. REUTERS/Roosevelt Cassio

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BRASILIA, (Reuters) - Brazil's manufacturing activity fell in August as a drop in new orders offset a small improvement in output levels, in a reminder that industrial output remains weak after growing in the second quarter for the first time in more than a year.

The Purchasing Managers' Index compiled by research firm Markit fell to a seasonally adjusted 45.7 in August from a four-month high of 46.0 in July.

The PMI index has remained below the 50 threshold separating expansion from contraction since February 2015. Output fell at the slowest pace since January 2015, but new orders and weakened from July, Markit said.

"Whereas a stabilization of Brazil's political crisis is expected to boost business and consumer confidence, an imminent upturn is unlikely," said Markit economist Pollyanna de Lima.

Gross domestic product on Wednesday showed industrial output rose between April and June after shrinking for five consecutive quarters. The numbers fueled hopes of a modest recovery following the ousting of President Dilma Rousseff.

(Reporting by Silvio Cascione; Editing by Meredith Mazzilli)

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