By Dow Jones Business News,
July 08, 2014, 08:38:00 AM EDT
By Paul Kiernan
RIO DE JANEIRO--Brazil's consumer inflation fell in June to its slowest pace in nine months as the waning impact of a
drought earlier this year caused food prices to decline.
Brazil's IPCA consumer price index rose 0.40% last month, compared with 0.46% in May, the Brazilian Institute of
Geography and Statistics, or IBGE, said Tuesday. On a 12-month rolling basis, the IPCA rose to 6.52% in June from 6.37%
a month earlier.
The monthly increase was slightly higher than the 0.39% median estimate of economists surveyed by the local Agencia
Brazil's inflation rose early this year as a drought sent prices for perishable food items soaring. Last month,
however, food and beverage prices declined by an average 0.11% from May, weighing on the consumer price index.
On the other hand, soccer's World Cup, which Brazil is hosting and which began June 12, caused prices for hotels to
rise 25% on average and airfares to rise 22%, the IBGE said.
Brazil's central bank aims to keep inflation at 4.5%, plus or minus two percentage points. Though the 12-month IPCA
rose above that target last month, economists don't foresee interest-rate increases anytime soon because the index is
expected to decline toward the end of this year.
Write to Paul Kiernan at email@example.com
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