Annual inflation in Brazil rose above 5% in February for the first time in more than four years, official figures showed on Thursday, above analysts’ expectations and driven largely by a strong rise in transport costs.
Coming less than a week before the central bank’s next policy decision, the figures are likely to cement the consensus view that the first increase in Brazilian interest rates since 2015 is imminent.
The annual rate of consumer inflation in February was 5.20%, statistics agency IBGE said, above the 5.06% median forecast in a Reuters poll of economists and the highest since January 2017, according to Refinitiv data.
The central bank’s year-end target is 3.75%, with a 1.5 percentage point margin of error on either side.
The monthly rate of inflation rose to 0.86%, IBGE said, the highest for any February since 2016 and higher than economists’ forecast for a 0.72% increase.
Eight of the nine categories surveyed by IBGE showed rising prices in February, with a 2.28% rise in transport costs accounting for almost half of the overall rise.
Within the transport segment, fuel prices rose more than 7% on the month, IBGE said.