Brazil´s February inflation stands at 1.31%
Without the electricity bill discount that helped curb inflation in January, the Broad National Consumer Price Index (IPCA), the official inflation rate, reached 1.31 percent in February. This is the highest rate since March 2022 (1.62%) and the highest for a February since 2003.
The IPCA tracks the cost of living for families with incomes between one and 40 minimum wages. Data released Wednesday (Mar. 12) by the Brazilian government´s statistics agency IBGE reveals that the 12-month accumulated IPCA stands at 5.06 percent—the highest since September 2023 (5.19%)—and exceeds the government's target of 3 percent, which allows for a tolerance of ±1.5 percentage points, setting the range at 1.5 percent to 4.5 percent.
Since the beginning of 2025, the target assessment period has covered the past 12 months rather than just the year-end figure (December). A breach is only recognized if the target exceeds the tolerance range for six consecutive months.
In January, the 12-month accumulated rate stood at 4.56 percent, making February the second consecutive month beyond the tolerance range under the new target monitoring model.
Electricity
The 16.8 percent increase in electricity prices was the main driver of inflation, contributing 0.56 percentage points to the index. This surge is due to the statistical effect of the Itaipu Bonus ending—a discount on electricity bills in January that had helped keep inflation at 0.16 percent that month.
“The residential electricity sub-item shifted from a 14.21 percent drop in January to a 16.80 percent increase in February,” explains IPCA manager Fernando Gonçalves.
According to Gonçalves, if electricity costs were excluded from the calculation, inflation would have stood at 0.78 percent, the highest since February 2024 (0.83%).
School fees
The second largest price increase in February was in education, which rose by 4.7 percent, contributing an impact of 0.28 percent. This surge can be attributed to the typical hikes in school fees, particularly for elementary school (7.51%), secondary school (7.27%), and preschool (7.02%).
Food
Food, a major concern for the Brazilian government, saw a slowdown in price increases in February. While prices continued to rise, the rate of growth eased to 0.70 percent (with an impact of 0.15 percentage points), down from 0.96 percent in January.
