Services activity in Brazil returned to growth in April and hit a nine-month peak on improved demand, showed a survey of the Purchasing Managers’ Index (PMI) released on Thursday.
S&P Global said the services sector PMI rose to 54.5 in April from 51.8 in March, marking the second consecutive month above the 50 level that separates growth from contraction.
The result is still the strongest since July 2022 (55.8), with survey participants highlighting improved demand conditions, contract renewals and advertising success, which ensured an increase in new orders for the second consecutive month in April and at the fastest pace since October 2022.
Reflecting the trend in new business inflows, employment rose at its fastest rate in six months, with evidence suggesting that open positions were being filled.
“Solid job growth coupled with positive manufacturing forecasts are a good sign for the near-term outlook,” said S&P Global Market Intelligence associate director of economics Pollyanna De Lima.
The month of April was again characterized by historically high price pressures in the Brazilian tertiary sector related to the costs of energy, food, fuel, construction materials, transport, water and wage negotiations with unions.
Even so, the rate of input prices was at its lowest level in four months and helped the prices charged to remain at their lowest level for the year in April.
Utility companies have maintained an optimistic view that production will increase over the next 12 months. Ongoing proposals, private investment and new business expansion expectations supported the positive forecast.
Performance in services activity contrasted with that in manufacturing in Brazil, and helped the composite PMI rise to 51.8 from 50.7 in March. In April, the manufacturing PMI fell further, raising a warning sign amid reduced output amid a steeper contraction in new jobs.
“April PMI results show a consistent history of cross-sector discrepancies. Manufacturing has plunged further into contraction…allowing the services sector to be the sole driver of private sector growth as we enter the second quarter,” he said. concluded De Lima.
Source: Terra
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