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UPDATE 1-Brazil consumer prices rise above 10% in 12 months for first time in five years

reuters.com · 09/24/2021 09:44
UPDATE 1-Brazil consumer prices rise above 10% in 12 months for first time in five years

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By Camila Moreira

- Brazil consumer prices were above 10% for 12 months for the first time in five years, after data released on Friday showed a steep rise in September.

IPCA-15 rose 1.14% in September, its highest for the month in 27 years. The 12-month IPCA reached 10.05%, above 10% for the first time since 2016, data released by national statistics agency IBGE showed.

The official inflation target followed by Brazil's central bank is 3.75%, with a 1.5 point tolerance margin. Rising inflation well above target has been pushing the central bank to increase interest rates with the benchmark Selic raised to 6.25% this week after a second 100 basis-point rise.

Fuel prices rose 3% in September, according to the data, contributing to a higher index through the rise in transportation costs. Gasoline rose 2.85% in September and accumulates a 39% rise over the last 12 months. The price of airline tickets rose 29% in September.

Electricity climbed 3.61%, as tariffs were raised after drought affected hydroelectric dams. Food prices rose 1.5% in September.

Estimates for inflation for the full year have affected market and even central bank estimates. The central bank estimates 8.5% inflation for this year, above its previous forecast of 6.5%.


(Reporting by Camila Moreira in Sao Paulo)

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