Bloomberg — Brazil’s unemployment rate ticked down for a fourth straight month in July, underscoring the resilience of Latin America’s biggest economy in the face of headwinds including double-digit borrowing costs.
Official data released Thursday showed the national unemployment rate declined to 7.9% from a month earlier, matching the median estimate from analysts surveyed by Bloomberg. Some 8.5 million people were out of work, the national statistics agency said.
A robust labor market helped lift the Brazilian economy far above analysts’ more pessimistic expectations from the start of the year. Steep borrowing costs and months of above-target inflation squeezed consumer spending and weighed on growth. Still, gross domestic product is expected to expand as much as 3% in 2023.
What Bloomberg Economics Says
“Brazil’s labor market tightened further in July, new job gains brought the employment level to a record high and, in another win for policymakers, that hasn’t translated into substantial wage pressures. We believe this should allow the central bank to proceed with another 50-basis-point rate cut at its Sept. 20 meeting.”
— Adriana Dupita, Brazil and Argentina economist
Brazil’s national statistics agency will release second-quarter GDP data on Friday.
--With assistance from Giovanna Serafim and Rafael Gayol.
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