Brazil's unemployment rate held steady at a 11.8% in the three months through August, statistics agency IBGE said on Friday, suggesting the gradual but steady improvement in the labor market seen in recent months has stalled. Persistently high unemployment and weak wage growth have been major factors behind the economy's sluggish growth and low inflation, and the latest figures are unlikely to change that picture much.

It was the first time in four months that the unemployment rate did not decline, coming in above the median forecast in a Reuters poll of economists of 11.7%. In the preceding three-month period from March to May, the jobless rate was 12.3%, IBGE said, while in the same three-month period last year it was 12.1%.

The number of Brazilians out of work fell by 419,000 in the period compared with the preceding three months, or by 3.2%, to 12.6 million. That was statistically unchanged, however, from the 12.7 million people a year ago, IBGE said. The underemployment rate, which hit a record 25.0% earlier this year, fell 0.7 percentage points to 24.3% from the preceding quarter, but again was unchanged from the same period last year, IBGE said.

It was a similar picture with the number of underemployed workers in Brazil: down 2.7% to 27.8 million from the prior three months, IBGE said, but "statistically stable" from a year earlier. Average household real income inched up 0.4% to 2,298 reais a month ($552), but only back to where it was in April, IBGE said.

Copyright Reuters, 2019