Services in Brazil have strong expansion in June despite high inflation, shows PMI

The expansion of the services sector in Brazil accelerated strongly in June and equaled the record of the historical series despite strong price pressures, according to the S&P Global Purchasing Managers Index (PMI) survey released on Tuesday. thursday (5).

The PMI jumped to 60.8 in June from 58.6 in May, equaling the highest rate in the historical series seen in April 2007 — the survey began compiling data in March of that year — amid an almost record new jobs and expanding demand.

The entry of new work accelerated compared to May and was the strongest since May 2007, supported by the acquisition of new business, greater investment and strong demand.

Consumer services saw the biggest rise in new business, followed closely by the finance and insurance subsector.

This increase, coupled with growth projections, ensured the rise in hiring in June, with job creation extending to the 13th consecutive month, at the strongest rate ever recorded.

Businesspeople in the sector maintained strong optimism in June, with sentiment on growth prospects at a nearly three-year high.

Companies also expressed hopes for a positive outcome from the October presidential election, and began to see increased production over the next 12 months due to further marketing and investment efforts.

The month, however, was also marked by an increase in corporate spending, with input costs rising at a slower rate than in May, but still the second strongest in the historical series.

The pressures came, according to the survey, from the strength of the dollar and higher costs of energy, food, fuel and hygiene products.

Given this, and with demand resilience, service providers raised their selling prices for the 20th month and at the strongest rate ever seen in the survey.

“Despite aggressive interest rate hikes, the inflation scenario has not improved. Input costs rose at a pace that was only surpassed in May,” said S&P Markit associate economics director Pollyanna De Lima.

With the strong result from services and the industry also growing in June, Brazil’s Composite PMI rose from 58.0 in May to 59.4 last month, the second strongest pace of expansion in business activity since the beginning of the survey. , in March 2007.

Source: CNN Brasil

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