Brazil’s services PMI rises to 54.8 in March, the highest in 20 months

The purchasing managers index (PMI) for the services sector in Brazil grew from 54.6 recorded in February to 54.8 in March, thus reaching the highest level in 20 months, reported this Wednesday (3) S&P Global. As a result, the sector showed its best quarterly performance since the three months to June 2022.

The composite PMI, which aggregates industry data, was 55.1, also the highest in 20 months.

According to the research, the month’s result was driven by the second fastest recovery in sales in just under a year and a half. Positive demand trends and optimistic expectations for the future have also encouraged the fastest employment expansion since October 2022.

Subsector data showed Consumer Services as the most successful area in terms of service activity, but it was Finance and Insurance that saw the sharpest expansion in new business. The Real Estate and Commercial Services subsector maintained its ranking for both analyses.

According to Pollyanna De Lima, associate economic director at S&P Global Market Intelligence, service providers reported in the survey an improvement in customers’ willingness to spend compared to recent months, which not only helped current sales, but also stimulated job creation. and increased confidence in the economic outlook.

However, she warned that the recent recovery in demand has come at the expense of higher inflationary pressures in the sector and that consumers are likely to see more pronounced increases in the prices charged for the provision of services in the coming months.

“Cost pressures remained considerably higher in the services economy than those seen in the industrial sector, but efforts to retain customers have somewhat contained price increases for now.”