Financial News: Brazil Services Growth Eases On Inflationary Pressures

Brazil Services Growth Eases On Inflationary Pressures

09/04/2024 - 09:54:00 (RTTNews)

(RTTNews) - Brazil's service sector expanded at a slower pace in August largely amid intensifying inflationary pressures, survey results published by S&P Global showed on Wednesday.

The seasonally adjusted S&P Global Brazil Services Business Activity Index dropped to 54.2 in August from 56.4 in the previous month. However, a score above 50 indicates expansion.

New business rose at the slowest pace so far this year but remained solid overall.

During August, Brazilian service providers faced higher business expenses, mostly driven by currency devaluation and an inflated market, followed by droughts and the aftermath of Rio Grande do Sul flooding.

The rate of input price inflation accelerated to a 25-month high, and selling price inflation climbed to the strongest in just under a year and a-half.

On a positive note, the rate of employment was solid and the fastest in three months on the back of positive sales developments and optimistic growth projections.

The composite output index fell from July's 25-month high of 56.0 in July to 52.9 in August. The slowdown in the private sector economy was due to a renewed decline in factory production.

Separate official data showed that the country's industrial production declined 1.4 percent monthly in August, reversing a 4.3 percent strong recovery in June.

The main negative influences came from food products, coke, petroleum products and biofuels, extractive industries, and pulp, paper, and paper products, flash data from the statistical office IBGE showed.

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