Brazil’s 12-month inflation rate, once a major worry for policy-nakers and consumers, once again declined in May, according to data released Friday by the Brazilian Census Bureau (IBGE). Monthly inflation in May weighed in at 0.31%, up from 0.14% in April, but still low enough to produce a significant decline in the 12-month figure. Twelve-month inflation as of May sank to just 3.6% from 4.08% as of April. Inflation has been on a downward curve since the beginning of the year. Inflation ended 2016 at a worrisome 6.3%. A number of factors contributed to the decline. These include high interest rates, a record grains crop and poor domestic demand due to unemployment. Both food and fuel prices declined in May while price hikes were led by electric power rates, which rose in the wake of a government decisio n to suspend certain subsidies. Inflation is widely expected to end the year between 3.0% and 3.5%.
Link to IBGE release