Brazil: Inflation increases at fastest rate in almost eight years
February 7, 2013
In January, consumer prices increased 0.86% over the previous month, which was above both the 0.79% rise recorded in December and market expectations of a 0.84% price rise. The strong increase, which represents the highest monthly rise since April 2005, was mainly driven by higher prices for food and beverages.
Building on the strong monthly price increase, annual headline inflation rose from 5.8% in December to 6.2% in January which, nonetheless, remains within the Central Bank's target of 4.5% with a tolerance margin of plus/minus 2.0 percentage points.
The Central Bank expects inflation to moderate further to 4.8% by the end of this year and to rise to 4.9% by the end of 2014, according to its Inflation Report from December 2012.