Unemployment rate jumps to four-year high of 33.6%

South Africa’s unemployment rate rose for a second successive quarter to a four-year high, potentially flagging fallout from the Iran war.

The rate rose to 33.6% in the three months through June from 32.7% in the prior quarter, according to data released by Statistics South Africa in Pretoria on Tuesday. The median estimate of four economists in a Bloomberg survey was 32.6%.

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The data captures the first full quarter read on employment since the Middle East conflict began on February 28. The war lifted energy prices in a hit to household budgets, while the South African Reserve Bank raised interest rates in May to control inflation in a further headwind for investment and spending.

The number of unemployed rose to 8.5 million from 8.1 million. Most of the job losses were in the community and social services, and mining sectors. The trade and construction industries added workers.

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The reading presents a setback for South Africa’s fragile economy, which could face further restraint if the Sarb opts to tighten monetary policy again to keep price pressures contained.

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Governor Lesetja Kganyago and his colleagues left the benchmark rate unchanged at 7% last month after hiking at their previous meeting, but warned they would act if needed.

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