IPEA: Inflation likely to close out year below center of target

Price rates are expected to slow further down

Published in 10/03/2017 - 19:27 By Wellton Máximo reports from Agência Brasil - Brasília

Brasília - A inflação oficial, medida pelo Índice Nacional de Preços ao Consumidor Amplo (IPCA), ficou em 0,55% em janeiro deste ano, taxa inferior a dezembro de 2013, que alcançou 0,92% (Marcello Casal/Agência Brasil)

Fixed prices (like energy, transport and other public fees) are to face a slight hike this yearAgencia Brasil

Brazil's official inflation, as measured by the National Broad Consumer Price Index (IPCA) is expected to close out the year below the center of the target (4.5%). The estimate was made by the Institute for Applied Economic Research (IPEA), which released its Carta de Conjuntura, a report on the first quarter of 2017. The institute did not announce a specific estimate for the IPCA, but merely declared it should end the year below 4.5%.

After last year's deflation, the institute reported, fixed prices (like energy, transport and other public fees) are to face a slight hike this year. The phenomenon is expected to raise inflation in the last quarter, but not enough to exceed the center of the target.

Food

According to IPEA, price rates are expected to slow further down for the rest of the year, thanks to the behavior of free prices. Most noteworthy are food prices, which should face a weaker increase this year, or even decline in some cases, as a result of the increase in grain harvests and oil-producing plants and not as a result of climate phenomena in the main producing regions, as has been the case over the previous years.

As for decisive external factors, IPEA reported that the price of commodities will hold steady chiefly for three reasons. Oil extraction will be counterbalanced by the increase in the US production of shale oil, the havests in both hemispheres are expected to rise, and China's decision to curb economic growth should pull down the globe's demand for iron ore.


Translated by Fabrício Ferreira


Fonte: IPEA: Inflation likely to close out year below center of target

Edition: Juliana Andrade / José Romildo

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