The Brazilian government has officially approved a new minimum wage increase. Effective January 1, 2026, the minimum wage will rise to 1,621 reais per month, equivalent to approximately 293.7 US dollars. This represents a 6.79% increase, as published in the Official Gazette. The decree was signed by President Luiz Inácio Lula da Silva. Under the new rate, the minimum daily wage will be 54.04 reais, and the hourly rate will be 7.37 reais. Since 2023, the Brazilian administration has implemented a minimum wage valuation policy aimed at guaranteeing real income increases for workers. The adjustment scheme considers inflation measured by the National Consumer Price Index (INPC) of the previous 12 months, to which is added the real growth of the Gross Domestic Product (GDP) recorded two years prior. In this regard, the Brazilian Institute of Geography and Statistics (IBGE) confirmed in early December that the GDP for 2024 grew by 3.4%, a key figure in determining the new minimum wage. The evolution of the minimum wage in Brazil shows an upward trend in recent years. In cases where there is no economic expansion, the adjustment is limited to inflation. According to this formula, the 2026 revision combines the accumulated inflationary correction through November 2025 with the performance of the Brazilian economy.
