Tags: brazil | inflation | forecast | economy

Brazil Economists Raise 2014 Inflation Forecast for Second Week

Tuesday, 27 May 2014 08:03 AM

Brazil economists raised their 2014 inflation forecast for the second straight week as they forecast the central bank will pause the world’s longest tightening cycle this week.

Brazil’s inflation will accelerate to 6.47 percent this year, compared with the previous week’s forecast of 6.43 percent, according to the May 23 central bank survey of about 100 analysts published. The upper limit of the central bank’s target range is 6.5 percent.

President Dilma Rousseff’s administration has struggled to tame consumer price increases without further jeopardizing growth. Annual inflation through mid-May was the highest in 10 months, and has remained above the midpoint of central bank’s target for over three years. With growth forecast to slow this year, policy makers will probably keep the key rate unchanged this week.

The central bank will hold the benchmark Selic at 11 percent at its May 28 monetary policy meeting, according to the median estimate from 41 economists in a Bloomberg survey. Since April 2013, policy makers have lifted the key rate nine straight times from a record low 7.25 percent.

Economists in the central bank survey lowered their 2015 key rate forecast to 12 percent from 12.25 percent last week. They maintained their 2014 estimate at 11.25 percent.

Annual inflation quickened to 6.31 percent in the 12 months through mid-May, above the 4.5 percent midpoint of the central bank’s inflation target range.

Latin America’s largest economy will expand 1.63 percent this year, down from 2.3 percent last year, the central bank survey shows.


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Brazil economists raised their 2014 inflation forecast for the second straight week as they forecast the central bank will pause the world's longest tightening cycle this week.
brazil, inflation, forecast, economy
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2014-03-27
Tuesday, 27 May 2014 08:03 AM
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