Brazil Service Sector Downturn Deepens In July

(RTTNews) - Brazil's service sector deteriorated at the fastest pace in more than four years in July, survey results published by S&P Global showed on Tuesday.

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

The further worsening conditions in July were due to an accelerated drop in new business intakes that instigated the fastest contraction in output in over four years. The decline in new orders was more evident in the finance and insurance segments.

On the price front, input price inflation remained high amid greater material costs, tax hikes, and unfavorable exchange rates. However, the rate of inflation eased to an eight-month low.

The survey revealed that employment showed a renewed decline in July, while services companies were less confident of a rise in output over the course of the coming 12 months.

The composite output index dropped to 46.6 in July from 48.7 in June, indicating the fastest decline of Brazilian business sector activity in over four years.