The further rise in Brazilian inflation, to 7.3% y/y in the middle of May, can partly be pinned on unfavourable base effects, but there are also signs of a broader increase in goods inflation. While this inflation spike should start to unwind in the next few months, the central bank is likely to remain hawkish, with another 75bp hike in the Selic rate (to 4.25%) at the next meeting in June looking almost certain.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services