Service sector grows 0.8% in October and is 2nd high in a row, says IBGE

The volume of the services sector grew 0.8% october compared to September, according to the Brazilian Institute of Geography and Statistics (IBGE) released on Thursday (12). Compared to October last year, the increase was 2.7%. This is the second consecutive high and the 6th positive monthly result in the year. "In the accumulated indicator from January to October 2019, the volume of services showed an expansion of 0.8%. The annualized rate, an indicator accumulated in the last 12 months, advancing 0.8% in October 2019, indicates pace gain compared to August (0.6%) and September (0.7%) reported IBGE. According to IBGE, among the five activities surveyed, four were discharged, with emphasis on the information and communication services sector (1.8%), driven both by the information technology segment (2.6%) and audiovisual (6.7%). Prospects for the economy The pace of economic recovery shows signs of improvement in this late stretch of the year and has pushed market analysts to raise projections for GDP growth in 2019 and 2020. Brazilian industrial production, for example, grew 0.8% in October, at the third monthly high in a row. In the year, however, the industrial sector still accumulates a drop of 1.1%. Retail sales grew only 0.1% in October, but in the 12-month increase accelerated to 1.8%. Among the factors that have contributed to higher domestic consumption, analysts cite the fall in the basic interest rate (Selic), inflation under control, credit expansion, FGTS looting and the recovery of the labor market, albeit at a slow pace and pulled by i which has increased the wage mass and the number of Brazilians occupied and with some income. Economists at financial institutions began to project a 1.1% increase in Gross Domestic Product (GDP) in 2019, according to the Central Bank's latest Focus survey. For next year, the growth forecast rose from 2.22% to 2.24% – at the fifth consecutive high.