Brazil mid-February inflation highest in four years
By Jamie McGeever
BRASILIA, Feb 24 (Reuters) - Brazil's IPCA-15 consumer price index rose 0.48% in the month to mid-February, statistics agency IBGE said on Wednesday, the highest February reading for four years, driven by strong rises in transport and education costs.
That was down from the 0.78% rate of monthly inflation in January, but higher than the median forecast in a Reuters poll of 0.46% and enough to push the annual rate of inflation up to 4.57%.
That is the highest in nearly two years and above the central bank's year-end target for consumer price inflation of 3.75%. The median forecasts in a Reuters poll of economists was 4.55%.
The figures suggest inflation pressures in Brazil remain high. With a persistently weak exchange rate and investor concern over the public finances intensifying, they are unlikely to ease any time soon. Nor will interest rate expectations.
Prices rose in six of the nine groups of goods and services covered by IBGE. Transport costs rose 1.1% in the month, accounting for almost half of the overall monthly increase.
Within that segment, fuel prices rose 3.3%, with gas prices rising for an eighth straight month. President Jair Bolsonaro caused a storm by announcing last week that he will replace the head of state-run oil giant Petrobras PETR4.SA after a spat over fuel prices.
Education costs rose 2.4% on the month, accounting for almost a third of the overall rise, IBGE said.
Food and drink prices rose 0.56%, less than half the rate of the previous month, IBGE said. Central bank policymakers have said they still see the rise in food prices as a temporary phenomenon, but admit that it has lasted longer than they had expected.
A weekly central bank survey of economists published on Monday showed the average 2021 inflation forecast rising to 3.80% from 3.60% and the average year-end interest rate outlook rising to 4.00% from 3.75%.
(Reporting by Jamie McGeever, editing by Larry King)
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