Services activity in Brazil contracted in March at its least intense pace in two years, a private survey showed on Wednesday, with confidence in an imminent economic recovery continuing to rise in the sector after a two-year-long crisis. The Purchasing Managers Index (PMI) for Brazilian services, compiled by research firm Markit, rose to 47.7 in March from 46.4 in February. The index has been below the 50 mark that separates contraction from expansion since February 2015.
Services account for about 60 percent of Brazil's gross domestic product. Markit's Composite Index, which also takes into account a recent improvement in manufacturing activity, rose to 48.7 in March from 46.6 in February. "PMI data for Brazil reinforce perceptions that the economic downturn bottomed out and that the only way is up," Markit economist Pollyana de Lima said. "The past two years have proven challenging for businesses, but there is finally a light at the end of the tunnel."