Brazil Service Sector Downturn Deepens In September

(RTTNews) - Brazil's service sector logged a faster contraction in September amid weaker demand conditions, survey results published by S&P Global showed on Friday.

The seasonally adjusted S&P Global Brazil Services Business Activity Index dropped to 46.3 in September from 49.3 in the previous month. Any score below 50 indicates contraction.

Among components, new orders fell for the sixth successive month due to demand retrenchment. Nevertheless, the pace of contraction eased to a 3-month low. Meanwhile, employment rose for the first time in three months, though the rate of job creation was only marginal.

On the price front, input price inflation remained high amid reports of union agreement, health plan adjustments, and rising material prices. As a result, selling prices rose further, but the pace of inflation retreated to a three-month low.

Looking ahead, service providers remained confident about output expectations over the year ahead amid expectations of a rebound in demand and softer inflationary pressures.

The composite output index dropped to 46.0 in September from 48.8 in August, signaling the fastest contraction in the Brazilian private sector in close to four and a half years.

Separate official data showed that industrial production rebounded 0.8 percent in August, following a 0.1 percent fall in July.

Among the activities, the most important positive influences were noted by pharmaceuticals and pharmaceutical products, with an increase of 13.4 percent, preliminary data from the statistical office IBGE, showed.