Brazilian services sector up 0.9% in May, third high in four months -IBGE

RIO DE JANEIRO, BRAZIL – The services sector, boosted by information technology services and freight transportation, rose 0.9% from April to May, according to data from the monthly services survey released by IBGE on Tuesday.

According to the institute, this is the third high in four months. The result was above expectations. Economic analysts had expected an increase of 0.2% for the month.

Economists expect the service sector to continue its recovery path this year, as it suffered the most during the pandemic. But very significant increases are not likely.

Now that the worst effects of Covid-19 are over, the macroeconomic scenario with inflation, rising interest rates, and still high unemployment is weighing on the sector.

The FGV IBRE index of confidence in the services sector (ICS) rose 0.4 points to 98.7 in June, suggesting stability. The indicator remains below 100 points, considered neutral on a scale of zero to 200.

“The unfavorable macroeconomic environment and uncertainty about the coming months could slow down the pace of recovery of the sector’s confidence,” assesses Rodolpho Tobler, coordinator of the survey.

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