Brazilian consumer inflation rose to new multi-year highs in the month to mid-March, statistics agency IBGE said on Thursday, driven by strong rises in transport and housing costs.
Prices rose in eight of the nine groups of goods and services covered by IBGE. Transport costs rose 3.79% in the month, accounting for around three-quarters of the overall monthly increase.
Within that segment, fuel prices rose 11.6%, with gas prices rising for a ninth straight month. Housing costs rose 0.7% on the month, accounting for around a tenth of the overall rise, IBGE said.
The IPCA-15 monthly price index rose 0.93%, the highest March reading for six years, and the annual rate of inflation rose to 5.52%, the highest in over four years and above the central bank’s upper limit of its target range for this year.
The monthly rate was virtually double the 0.48% rate the month before and in line with the median forecast in a Reuters poll of economists for 0.96%. The annual rate was up almost a full percentage point from February, and also in line with economists’ 5.55% forecast.
The figures suggest inflation pressures in Brazil remain high, with a weak exchange rate and fragile public finances. Economists expect the annual rate to continue rising in the coming months before easing in the second half of the year.
The Central Bank‘s 2021 goal is 3.75%, with a 1.5 percentage point margin of error on either side. Citing inflation concerns, the central bank raised interest rates last week for the first time in six years and pledged to do so again in May.