March 29, 2018 / 1:07 PM / 8 months ago

UPDATE 1-Brazil jobless rate up for second month in Feb on seasonal effects

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By Bruno Federowski

BRASILIA, March 29 (Reuters) - Seasonal effects pushed up Brazil’s unemployment rate for a second straight month in February, highlighting the labor market’s slow and uneven recovery from a deep recession.

The jobless rate rose to 12.6 percent in the three months through February from 12.2 percent in January, government statistics agency IBGE said on Thursday.

Unemployment in Brazil tends to rise in the first quarter of the year as temporary contracts signed during the year-end holiday season expire, said IBGE economist Cimar Azeredo.

The two months of gains follow nine months of declines that brought the unemployment rate down from all-time highs.

Even that improvement, however, showed signs of weakness as nearly all employment gains involved informal jobs. The number of formal workers fell in February to the lowest levels since 2012, IBGE said.

With wages adjusted for inflation stagnating, the central bank may struggle to lift inflation back to its targeted range after undershooting it for the first time ever last year.

Earlier this month, the bank surprised observers by hinting at an additional interest rate cut in May even as the benchmark Selic rate was at an all-time low. Double-digit unemployment, as well as widespread idle capacity at companies, have kept a lid on inflationary hikes. (Editing by Bernadette Baum)

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