SAO PAULO, Oct 20 (Reuters) - Sales in Brazilian bars

and restaurants dropped 4.9% in September compared to August

amid growing cases of methanol contamination in alcoholic

beverages, data released by payment company Stone and

the Brazilian Association of Bars and Restaurants Abrasel showed

on Monday.

WHY IT'S IMPORTANT

Brazil recorded 133 reports of methanol poisoning linked to

alcoholic beverages since September, including 46 confirmed

cases and eight deaths, according to the Brazilian Health

Ministry.

The contamination has sparked consumer fears, adding

pressure to a sector already facing inflation and weak job

creation.

CONTEXT

Brazil's consumer prices rose 0.48% in September, reversing a

0.11% decline in August, according to official data. Meanwhile,

formal job creation fell short of economists' projections in

August.

These factors, along with the methanol contamination

concerns, have impacted discretionary spending, such as dining

out, according to the survey.

KEY QUOTE

"The methanol poisoning cases spread panic among consumers

and caused a drop in activity at some establishments," Abrasel

head Paulo Solmucci said in a statement.

WHAT'S NEXT

To stabilize sales, the bar and restaurant industry will

need to rebuild consumer confidence and adapt to ongoing

economic challenges, including inflation and reduced disposable

income.