Brazil: Inflation drops to lowest level since May in November
December 7, 2018
Consumer prices fell 0.21% in November over the previous month, contrasting October’s 0.45% increase. November’s result marked the sharpest drop since June 2017 and was a larger fall then market expectations of a 0.09% decrease. A drop in transportation prices was chiefly behind the fall, due to lower oil prices and a cut in government administrated electricity prices thanks to abundant rain.
Inflation fell to 4.0% in November, the lowest reading since May (October: 4.6%). Inflation is contained within the Central Bank’s target of 4.5% plus or minus 1.5 percentage points. However, annual average inflation edged up from 3.5% in October to 3.6% in November.
Brazil Inflation Forecast
Panelists participating in the LatinFocus Consensus Forecast see inflation closing 2019 at 4.4%, which is unchanged from last month’s forecast. For 2020, the panel expects inflation of 4.2%.