Banks and consultancies have been insisting for months that the economy will slow down in the second half of the year. The persistence of high interest rates, in particular, justifies this expectation, which does not, however, mean a collapse. The economy grew 2.3% in 2025 and is expected to advance between 1.8% and 2% this year, shrinking to around 1.5% in 2027 – a year of fiscal adjustment above all.
Despite the outlook, the Central Bank (BC) has no choice but to maintain monetary tightening to curb inflation, which is expected to exceed 5.3% this year, against the target of 3%. Despite this assessment, institutions do not rule out faster effects of monetary tightening – as interpreted by some experts in the result of formal job creation in May. The Caged (General Register of Employed and Unemployed Workers) reported the opening of 72,960 positions. The worst figure since 2020.
This performance, well below the expected 120,000 to 130,000 jobs, triggered warnings about the possible need or possibility of the Central Bank cutting the Selic rate again in August, after three reductions since the beginning of the year. For now, however, there is no indication that the Central Bank will relax its purpose of promoting the convergence of inflation to the target, even if in a longer term as it has already indicated.
However, information detected by the National Confederation of Commerce of Goods, Services and Tourism (CNC) in its Family Consumption Intentions (ICF) survey demands attention and monitoring from the private sector and, above all, from the government: the Brazilian's caution regarding the future of employment.
The caution identified stems from the Professional Outlook item, which is part of the Household Consumption Intention indicator. The professional outlook showed a second monthly decline in June, of 0.2%. This variation maintained the low performance of this variable at 6.3% compared to the same period in 2025.
The decline is noteworthy because it goes against the grain of still resilient labor market data, with the unemployment rate at a historically low level. But this apprehension about future employment neither frightens nor surprises those who understand the subject.
Speaking to NeoFeed , economist Nelson Marconi from the Getulio Vargas Foundation (FGV) observes that, despite the general statistics revealed by research institutes, Brazilians may indeed be concerned about the future of work due to current indebtedness and the realization that the country is in an electoral cycle.
“Even though the population doesn’t have a clear or theoretical idea of what adjustments will need to be made to the economy in 2027, the prevailing feeling is that some change will occur, starting with the next presidential term. This is partly because there is an awareness or perception that a course correction must occur since the government spends more in election years,” he observes.
A labor market expert, Marconi makes no secret of his critical stance regarding interest rates in Brazil. And not just the level of the Selic rate, but the economic policy strategy based on monetary restriction versus fiscal expansion, lacking a focus on growth – a crucial element for the labor market.
According to the expert, monetary policy remains strongly contractionary due to the commitment to the 3% inflation target, "extremely ambitious for the structural characteristics of the Brazilian economy," which leads to the practice of an expansionary fiscal policy and income transfer programs that support household consumption. Marconi advocates a target of around 4%, considering it more appropriate for the Brazilian reality.
Consumer intent weakens
The combination of expensive money, debt, still high inflation, and selective credit – given the historical default rate – helps explain Brazilians' caution regarding medium-term employment. However, most families perceive the current job market as "safe."
Despite medium-term concerns, the intention to consume remains at its highest level in 2015, but is moderating. The CNC (National Confederation of Commerce) reports that the Household Consumption Intention Index reached 105.5 points in June. However, the indicator advanced 0.1% in the month – the most modest variation since November.
In June, most of the variables that make up the ICF (Consumer Confidence Index) registered positive results, but the highlight was the "Moment for Durables" which rose 1.2%, well above the 0.1% of the overall indicator. In the annual comparison, the moment for buying durables jumped 20.3%, compared to 3.2% for the closing index.
And inflation is partly to blame. In May, the entity says, the price level of durable goods showed deflation of 0.08%, while the IPCA (Brazilian consumer price index) rose 0.58%. Over 12 months, inflation for durable goods accumulated 0.78% and the overall indicator 4.72%.
The price gap encourages the purchase of these goods for several reasons, explains experienced pricing specialist Fábio Romão, partner at Logos Economia, to NeoFeed. Among them is the exchange rate. Romão points out that last year, the country experienced an appreciation of the real against the dollar, a factor that helps moderate price adjustments in this segment. Another factor, Romão continues, is household debt itself, which can mitigate price increases for durable goods, especially those with higher added value and requiring access to credit.
Debt is a major problem for Brazilians, and it's no wonder the government is striving to smooth things over, because any easing of the burden can translate into votes. So much so that the first half of the year ended with the launch of yet another "offspring" of the original Desenrola program, which already had a first and second edition.
Now it's the turn of the "Desenrola Adimplentes" program for informal workers and students who keep their accounts up to date but are burdened with high interest rates that could make future payments impossible – according to the government.
