BRASILIA (Reuters) - Brazil’s March jobless rate rose more than expected for a third month, suggesting last year’s decline may have been a temporary breather instead of a sustainable pickup in employment.
The unemployment rate rose to 13.1 percent in the three months through March, government statistics agency IBGE said on Friday, surpassing the median 12.9 percent forecast in a Reuters poll of economists.
It is the largest reading since May 2017, matching the highest forecast in the Reuters survey and edging closer to a 13.7 percent all-time high reached in March of that year.
Steady growth in off-the-books jobs, which do not have access to work benefits, had driven a nine-month string of falling unemployment ended in December. Yet even informal unemployment suffered at the start of 2018 as contracts for temporary holiday-season workers expired.
Formal employment has yet to show signs of heating up, an indication that Brazil’s slow and uneven economic recovery may take a while before trickling down to the labor market.
Steady unemployment should keep a lid on price pressures as wages remain stagnated when adjusted for inflation, hurdling the central bank’s efforts to lift it back to its target range.
This should keep the central bank on track to cut interest rates by an additional 25 basis points to an all-time low of 6.50 percent at its meeting next month.
Reporting by Bruno Federowski; Editing by Bill Trott