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Montevideo, September 21st 2018 - 08:12 UTC

Inflation in Brazil slowing down for the first time in 14 months

Tuesday, October 25th 2011 - 04:19 UTC
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The Central bank’s policy is to lower the benchmark rate to counter world crisis The Central bank’s policy is to lower the benchmark rate to counter world crisis

Economists covering Brazil cut their 2012 inflation forecast for the first time in eight weeks, cementing expectations that the central bank will continue to cut interest rates.

Consumer prices will rise 5.6% next year, according to the median forecast in an Oct. 21 central bank survey of about 100 economists published Monday, compared with a forecast of 5.61% the previous week. Analysts also dropped their forecast that Brazil will miss its inflation target this year for the first time since 2003. Prices, as measured by the IPCA index, will gain 6.5% this year, from the week-earlier forecast of 6.52%, the survey showed.

The bank last week cut its benchmark Selic rate to 11.5% from 12%, saying this would protect Brazil from a more “restrictive” global economy without compromising the inflation target. Economists expect policy makers to lower borrowing costs by half a point at their November policy meeting, and to 10.5% by the end of 2012, the survey found, unchanged from the previous week’s forecasts.

Latin America’s biggest economy is expected to grow 3.3% this year, down from a forecast of 3.42% the previous week, the survey showed. Analysts also cut their 2012 growth forecast to 3.51% from 3.6%.

Annual inflation slowed in mid-October for the first time in 14 months. Consumer prices, as measured by the IPCA-15 index, climbed 7.12% in mid-October from a year earlier, compared with 7.33% the previous month.

The economic activity index, a proxy for GDP, contracted 0.53% in August from the month before, its biggest monthly drop since the global financial crisis of 2008. August retail sales fell the most since March 2009, while industrial production registered its third decline in five months.
 

Categories: Economy.

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  • briton

    even a cheetah gets out of breath .

    Oct 25th, 2011 - 04:21 pm 0
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