Consumer prices in Latin America’s largest economy performed more favorably than expected, despite restrictive conditions and the dispute over interest rates between the Executive and the Central Bank.
In December, consumer prices in Brazil saw a higher-than-expected increase, with an increase of 0.6% according to the benchmark IPCA index, according to data provided by the government statistics agency IBGE. This result exceeded the projection of economists surveyed by Reuters, who expected a 0.5% increase, driven primarily by higher food and transportation costs.
Despite this monthly reboundl, the annual inflation rate managed to close the year within the target range established by the Central Bank, marking the first time since 2020. The headline 12-month inflation rate stood at 4.62%, slightly above the 4.54% forecast in surveys. However, this result remained below the upper limit of the central bank’s target range, which ranges from 1.75% to 4.75%.
It is worth noting that, throughout 2023, consumer prices in Latin America’s largest economy performed more favorably than expected, despite the restrictive monetary conditions that persisted throughout the year. These conditions remain in place even after the Central Bank began reducing borrowing costs in August.
Source: Ambito
