BRASILIA (Reuters) – Brazil's inflation rate soared into the central bank's official target range in mid-June following a nationwide protest by truckers drove product shortages prices, lifting consumer prices via the most in many more than couple of years.
Still, the short-term spike in prices was unlikely to drive a car the lender to hike loan rates soon, economists said, as double-digit unemployment kept a lid on underlying inflation pressures.
The benchmark IPCA index rose 1.11 percent from mid-May, government statistics agency IBGE said on Thursday, surpassing the median 1.0 percent forecast inside a Reuters poll of economists.
Higher food and gas prices added probably the most to inflation while in the month, to be a trucker protest over high diesel prices blocked major highways, nearly paralyzing key sectors and forcing farmers to cull their flocks and dump spoiled milk.
An rise in power rates also helped to drive the 12-month inflation rate to three.68 percent, sharply more than both.86 percent reading after May.
That should bring some respite into the central bank, which contains struggled for getting inflation back in its target selection of 4.5 %, plus or minus 1.5 percentage points after undershooting it for the first time ever a year ago.
However, the surge is not likely to significantly alter market expectations which the bank will try to keep from raising rates of interest until next season.
The bank on Wednesday kept rates at an all-time low as the Brazilian real (BRBY) slumped into a two-year bottom. In their policy statement, the lending company acknowledged that your trucker strike may likely enhance inflation and weigh on business activities at any given time when price pressures remain muted.