Brazil services activity rises in line with forecasts in July

SAO PAULO, Sept 12 (Reuters) - Services activity in Brazil grew in line with expectations in July, marking a sixth consecutive monthly expansion despite tight monetary policy, data from statistics agency IBGE showed on Friday.

The main driver of Latin America's largest economy rose 0.3% in July from the previous month, reaching a new peak in the historical series, IBGE said.

On an annual basis, services output grew 2.8%, slightly above the 2.6% median forecast in a Reuters poll of economists.

Three out of the five activities surveyed posted gains in July, with the strongest contribution coming from the information and communication sector, which grew 1%, according to IBGE.

Transportation recorded the sharpest decline, falling 0.6%, partly due to higher ticket prices, IBGE's research manager Rodrigo Lobo said in the report.

Persistent inflation in the services sector remains a concern for Brazilian policymakers, who are set to meet next week to decide on interest rates. Markets widely expect the benchmark Selic rate to be held at 15%, its highest level in nearly two decades.