Brazil services beat forecasts, posts eighth straight growth in September

SAO PAULO, Nov 12 (Reuters) - Services activity in Brazil exceeded expectations in September, rising for the eighth straight month and hitting a record high, despite tight financial conditions, data from the national statistics agency IBGE showed on Wednesday.

The main driver of Latin America's largest economy rose 0.6% in September compared to the previous month, beating the 0.4% increase projected in a Reuters poll. Year-on-year, services output grew 4.1%, also surpassing expectations of a 3.6% rise.

Transportation has been the main driver of the recent positive readings, IBGE research manager Rodrigo Lobo said in a statement, highlighting road freight as the primarily responsible for keeping the service sector buoyant.

"Transport logistics is growing due to increased e-commerce sales, which ultimately drives the storage of goods, logistics, and transport to the end consumer," Lobo said.

Price increases in the service sector remain a concern for Brazilian policymakers, who noted in the minutes of their latest monetary policy meeting that services inflation remains resilient, supported by a still-strong labor market.

Brazil's central bank aims for a 3% inflation plus or minus a margin of 1.5 percentage points. Last week, it kept the benchmark Selic rate steady for the third consecutive meeting at a near 20-year high, reinforcing its view that the current 15% rate is adequate to bring inflation back to target.