| SAO PAULO
SAO PAULO Jan 6 Activity in Brazil's services
sector expanded for a fourth straight month in December, though
at a slightly slower pace, a business survey showed on Monday.
HSBC's Purchasing Managers Index for Brazilian services
fell to 51.7 in December from 52.3 in November on a
seasonally adjusted basis. A reading above 50 indicates
HSBC's Composite Output Index for the country,
which includes manufacturing activity, fell to 51.7 in December
from 51.8 in November, though remained in positive territory for
the fourth straight month.
The data will likely boost expectations that Brazil's
services sector will continue to support Brazil's sputtering
economy, which shrank 0.5 percent in the third quarter from the
second quarter, its worst performance since the
global financial crisis in 2008-2009. Government officials and
private economists said Brazil would likely post positive growth
for the last quarter of 2013, even if at mediocre rates.
Growth was broadly based, reaching all six categories of the
survey for the second straight month, with incoming new business
expanding for the sixteenth straight month. Survey respondents
cited new contract wins, in some cases linked to the upcoming
World Cup, which kicks off in June.
Employment increased for a tenth straight month as survey
respondents remained more positive than negative on the outlook
for business activity, though optimism fell to its lowest level
in seven months.
"Slower growth in business activity was accompanied by a
softer expansion in new orders and waning confidence, but also
by less pressure on both input costs and prices charged," wrote
Andre Loes, HSBC's chief Brazil economist.
The pace of input price increases for the services sector
eased slightly but remained near the highest level in nearly a
year and a half.
The pace of output price increases also slowed in December
from the previous month, though prices in the hotels and
restaurants category accelerated at their sharpest pace in
almost four years according to the survey, compiled by research