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(Bloomberg) -- Probability of Brazil having a higher output with flat working force in the aftermath of the crisis, together with economy idleness and drop in inflation estimates, helps reinforce scenario of lower interest rates and for longer, according to analysts surveyed by Bloomberg.

• BCB’s comments in Inflation Report on cyclical increase in productivity implying room for output growth without equivalent expansion in job market, is key in terms of future steps in monetary policy, Safra Chief Economist Carlos Kawall says in report
  • Comments imply subdued wage pressure, with the economy recovering and while the output gap is reduced
• Goldman Sachs Senior Economist Alberto Ramos said in an interview that he agrees with BCB’s view on room for a significant recovery in activity without generating inflation, but also without initially generating much employment
  • However, positive scenario should not prevent central bank from slowing the easing pace to 75 bps, which would still be a "significant cut"
• Economic recovery process has become clearer, but with high unemployment and still-large idle capacity with current FX rate and external scenario, recovery isn’t likely to generate inflationary pressure, Nomura Economist Joao Pedro Ribeiro says by phone
• With idleness expected to remain high for some time and wages under pressure, BCB shouldn’t raise rates again until 2020, Rabobank Strategist Mauricio Oreng says in a telephone interview
• NOTE from Sept. 21: Brazil Central Bank Sees Rising Growth With Lower Inflation (1)

Original Story: Visão do BC sobre produtividade reforça cenário de juro menor To contact the translator on this story: Giulia Camillo in Sao Paulo at gcamillo@bloomberg.net Reporters on the original story: Vinícius Andrade in São Paulo at vandrade3@bloomberg.net; Josue Leonel in Sao Paulo at jleonel@bloomberg.net Editors responsible for the original story: Daniela Milanese at dmilanese@bloomberg.net Fernando Travaglini