Brazil Inflation January 2020


Brazil: Inflation eases in January

February 10, 2020

Consumer prices increased 0.21% month-on-month in January, following December’s sharp 1.15% increase. The reading underwhelmed market expectations of a 0.34% rise and came in tandem with a sharp depreciation in the Brazilian real. Lower food and beverage costs, particularly as meat prices receded after surging at the end of last year, and cheaper health and personal care. Conversely, housing registered the highest price increases in January.

Inflation edged down to 4.2% in January from 4.3% in December, which was comfortably within the Central Bank’s target of 4.0% with a tolerance band of plus or minus 1.5 percentage points for the end of 2020. Annual average inflation, on the other hand, increased to 3.8% in January from 3.7% in December.

Panelists participating in the LatinFocus Consensus Forecast see inflation closing 2020 at 3.8%, which is unchanged from last month’s forecast. For 2021, the panel also expects inflation of 3.8%.

Author:, Economist

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Brazil Inflation Chart

Brazil Inflation January 20 20 0

Note: Annual and monthly var. of IPCA consumer price index in %.
Source: Brazilian Institute of Geography and Statistics (IBGE).

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