Brazil’s unemployment rate for the three months ended July fell to 7.9%, data released on Thursday by statistics agency IBGE revealed. This is the lowest unemployment rate that Latin America’s largest economy has experienced in this period over the past nine years.
This drop in unemployment reflects the strengthening of Brazil’s labor market, with Bank of America deciding to boost its forecast for the country’s economic growth this year and the next due to such developments.
The good news of the day comes from the job market,” Inter’s chief economist Rafaela Vitoria said. “Real wages remained stable at the margin, which is also good news for the central bank. It should continue to lower the key Selic rate at the 50-basis-point pace in its next meetings.”
Brazil’s strong unemployment numbers come despite Brazil’s high interest rates, with the central bank choosing to implement a larger-than-expected 50 basis point hike.