April 20, 2016 / 3:25 PM / 3 years ago

UPDATE 1-Brazil national unemployment rate reaches double digits

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BRASILIA, April 20 (Reuters) - Brazil’s national unemployment rate shot above 10 percent, data showed on Wednesday, shedding light on the severe economic crisis taking root as the bitter political fight over President Dilma Rousseff’s impeachment paralyzes government.

The national unemployment rate rose to 10.2 percent in the three months through February, jumping from 9.5 percent in the three months to January and 9 percent in the final quarter of last year, the government statistics agency IBGE said.

“The numbers show further deterioration in the labor market,” economists at Sao Paulo-based consultancy MCM wrote in a note to clients. “Not only did the number of employed people fall, but work has become more precarious and wages fell more intensely.”

The national unemployment rate replaced a narrower monthly calculation discontinued last month by IBGE that covered only Brazil’s six largest metropolitan areas.

In February, the monthly jobless rate stood at 8.2 percent, the highest in nearly seven years.

At the end of 2014, the national unemployment rate stood at 6.5 percent as the country entered its worst recession in decades.

The unemployment rate is set to continue rising and is unlikely to drop before 2018, according to most economists surveyed in a recent Reuters poll.

Unemployment benefits were set to expire for more than 2 million people in the first half of this year, according to data obtained by Reuters, in a threat to years of progress against poverty in one of world’s most unequal countries.

That prospect can add to the political headaches for Rousseff. On Sunday, the lower house of Congress voted to impeach her on accusations that she manipulated public accounts to mask a ballooning budget deficit.

Her impeachment case moves to the Senate where the opposition is expected to win the simple majority required to suspend her and start a trial that could last six months.

Should Rousseff be tried by the Senate, Vice-President Temer is slated to take power as acting president.

Reporting by Rodrigo Viga Gaier; Writing by Silvio Cascione; Editing by Chizu Nomiyama and W Simon

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