By Marcela Ayres
BRASILIA – Inflation in Brazil grew more than expected in the month to mid-March, the biggest jump for that period in seven years, data showed on Friday, underscoring across-the-board price pressures despite aggressive monetary tightening led by the central bank.
Brazil’s official IPCA-15 consumer price index rose 0.95% in the month, down from 0.99% in February but above the median forecast in a Reuters poll of a 0.87% increase.
According to IBGE statistics agency, all nine groups of products and services surveyed recorded higher prices, especially food and beverages, which rose 1.95% over the previous month.
Inflation in the 12 months to mid-March climbed to 10.79%, also above the 10.69% projection in the poll.
That is far from the central bank’s year-end target of 3.5%, reflecting an already complex domestic inflationary dynamic that was further impacted by the surge in commodity prices after Russia’s invasion of Ukraine.
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Brazil’s central bank chief Roberto Campos Neto said inflation should peak in April, stressing that the short-term figure will be a “little higher” than previously expected by policymakers.
Earlier this month, the central bank raised the country’s benchmark interest rate by 100 basis points to 11.75%, from a record-low of 2 last March, and signaled another hike of the same size in May. That could wrap up a rate hike cycle that should weigh on the economy this year.
(Reporting by Marcela Ayres; Editing by Andrew Cawthorne)