Brazil’s annual inflation rate decelerated to 4.64% in June, falling below all economist forecasts in a Bloomberg survey.
The softer-than-expected print strengthens the argument for the central bank to resume cutting interest rates, as price pressures continue to ease across the economy.
41% rise in early June, marking a second consecutive month of disinflation.
The data follows a mid-month gauge that showed a 0.41% rise in early June, marking a second consecutive month of disinflation.
Together, these figures suggest that the central bank’s previous tightening cycle has successfully anchored price expectations, clearing the path for monetary easing.
Market participants had been closely watching for signs that inflation was moving sustainably toward the central bank’s target.
The June result, combined with the recent stabilization of inflation forecasts in the official Focus survey, indicates that the risk of a prolonged pause in rate cuts has diminished.