Brazil Inflation December 2016

Brazil

Brazil: Inflation ends 2016 within Central Bank's target range

January 11, 2017

Brazilian consumer prices in December increased 0.30% over the previous month, which was above November’s 0.18% rise and undershot the 0.27% figure analysts expected. The rise in consumer prices was driven by higher prices for food and drinks and a surge in transportation prices.

Inflation dropped in December to an over two-year low of 6.3%, below November’s 7.0%. Inflation fell notably in 2016 after ending 2015 at 10.7%, leading the Central Bank to cut the SELIC interest rate multiple times to support an economic recovery. As a result of the fall, inflation is now within the Central Bank’s target band of 2.5%-6.5%.

Panelists participating in the LatinFocus Consensus Forecast see inflation closing 2017 at 4.9%, which is down 0.1 percentage points from last month’s forecast. For 2018, the panel expects inflation of 4.7%.


Author: Angela Bouzanis, Senior Economist

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Brazil Inflation Chart


Brazil Inflation December 2016

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


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