Brazil: Inflation falls in December, ends 2014 within Central Bank's tolerance margin
January 9, 2015
Consumer prices in December increased 0.78% over the previous month, which marked the largest increase since March. The print was above the 0.51% increase recorded in November, but matched market expectations. The result was driven by a broad-based increase in prices, with notable rises in the prices for transportation and clothing, as well as for, food and beverages.
Annual headline inflation ended 2014 at 6.4%, just within the Central Bank’s tolerance margin of plus/minus 2.0 percentage points around 4.5%.The result was notably above 2013’s inflation rate of 5.9%. Inflation has remained at or above the government’s tolerance margin since June and was at the forefront of the election debate last year. Following President Rousseff’s reelection in October, the Central Bank decided to raise the SELIC interest rate to the highest level in almost three years in an effort to combat the high inflation rate.