Brazil’s unemployment rate rose in the quarter through February as more people actively looked for jobs, official data showed on Friday, with analysts pointing to a still tight labor market as job creation last month exceeded forecasts.
Unemployment in Latin America’s largest economy hit 6.8% in the three months through February, statistics agency IBGE said, up from the 6.1% registered in the previous rolling quarter and matching economists’ expectations in a Reuters poll.
It was the highest reading since the three months up to July 2024.
On the other hand, Brazil created in February 431,995 formal jobs, separate data from the labor ministry showed, far exceeding the 250,000 expected in a Reuters poll.
The figure also followed a much stronger-than-expected performance recorded in January.
“While there was a slowdown in job creation at the turn of the year, Brazil’s labor market remains just as tight as it was six months ago,” economists at JPMorgan said in a note to clients.
According to IBGE’s household surveys coordinator Adriana Beringuy, the increase in the jobless rate followed a seasonal pattern of the survey.
“(There is a) tendency of expansion in job seeking during the months of the first quarter of each year,” she said in a press release.
Brazil’s jobless rate in recent quarters had fallen to historic lows, data cheered by the government but also cited by the central bank as a factor in its interest rate hikes amid increased consumer prices.
The central bank raised interest rates last week by 100 basis points to 14.25% – a level not seen since 2016 – and signaled a smaller increase to come in May.
In recent weeks, a string of economic indicators has shown signs of a slowdown in the Brazilian economy but the central bank said this month it was still too early to establish a clear trend, as some mixed data continue to emerge.
(Reporting by Isabel Teles and Camila Moreira in Sao Paulo, Victor Borges in Brasilia; Writing by Andre Romani; Editing by Kylie Madry, Mark Porter, Gabriel Araujo; Editing by Rod Nickel)
