Brazil Unexpectedly Created Jobs in March for First Time in 2015

Brazil’s economy last month unexpectedly created jobs for the first time this year as government efforts to boost business confidence show signs of succeeding.

Brazil created 19,282 jobs in March, according to a Labor Ministry report published Thursday. The median estimate of 17 economists surveyed by Bloomberg was for 20,800 job cuts, following three straight months of losses.

The labor market, one of the bright spots in President Dilma Rousseff’s first term, has shown some indications of softening since her re-election in October as her administration pledges to contain public spending and raise taxes to attract investors and avert a credit-rating downgrade. Analysts surveyed by the central bank forecast gross domestic product will shrink this year before rebounding in 2016.

Swap rates on the contract due in January 2017, the most traded in Sao Paulo Thursday, rose 4 basis points, or 0.04 percentage point, to 13.36 percent at 2:07 p.m. in Sao Paulo. The real strengthened by 1.3 percent to 2.9730 per dollar on speculation the Federal Reserve isn’t in a hurry to raise U.S. borrowing costs.

Service companies boosted hiring by 53,778 people, offsetting cuts in manufacturing, construction and agriculture, according to the report. Industrial confidence this month increased for the first time in 2015, the national industrial confederation said in a report today.

The jobless rate surged to 5.9 percent in February, the highest since June 2013. The increase comes as economists surveyed by the central bank forecast gross domestic product will shrink 1.03 percent in 2015 before expanding 1 percent next year.

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