Inflation: March IPCA is up 0.71%, says IBGE – 04/11/2023 – Market
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Driven by gasoline, Brazil’s official inflation index rose 0.71% in March, after rising 0.84% in February.
This is what the data from the IPCA (National Index of Consumer Prices) released this Tuesday (11) by the IBGE (Brazilian Institute of Geography and Statistics) show.
Analysts consulted by the Bloomberg agency projected an increase of 0.77% in March, a period that marked the partial return of the collection of federal taxes on gasoline and ethanol.
With the new result, the IPCA accumulated inflation of 4.65% in 12 months. The advance was 5.60% until February.
The center of the inflation target, which serves as a reference for the BC (Central Bank), is 3.25% in 2023. The tolerance interval is 1.5 percentage points more (4.75%) or less (1.75%).
For analysts, the IPCA should exceed the target for the third consecutive year. On the median, the financial market predicts inflation of 5.98% in the accumulated until December 2023, according to the most recent edition of the Focus bulletin, released on Monday (10).
At the beginning of his government, the BC became the target of criticism from President Luiz Inácio Lula da Silva (PT). The reason was the level of interest in the country.
In an attempt to contain inflation, the Central Bank maintained the basic interest rate (Selic) at 13.75% per year. By cooling the demand for goods and services, the measure seeks to curb prices and anchor expectations for the IPCA.
The expected side effect is the loss of breath of economic activity, because the cost of credit is higher for companies and consumers.
Lula has already defended an easing of the inflation target with the expectation of making room for cutting interest rates. Part of economists, however, understands that the concrete effect would be the opposite, by increasing uncertainties.
“If the goal [de inflação] is wrong, the goal is changed”, said the president last week.
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