Brazil's Inflation Continues to Slow in May

By Jeffrey T. Lewis Features Dow Jones Newswires

Brazilian inflation continued to slow in the 12 months through the end of May, leaving the door open for more interest-rate cuts by the country's central bank.

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Consumer prices rose 0.31% during the month and increased 3.6% from a year earlier, the Brazilian Institute of Geography and Statistics, or IBGE, said Friday. In April, prices rose 4.8% from a year earlier.

Transport and food and drink prices fell the most in the month, with declines of 0.42% and 0.35%, respectively, the agency said. The biggest increase was in the cost of housing, which rose 2.14%, mostly because of the higher price for electricity, according to the IBGE.

The central bank's target for 12-month inflation is 4.5%, with a tolerance range of 1.5 percentage points in either direction. The bank raised its benchmark lending rate to 14.25% in 2015 and left it there for more than a year as price increases accelerated, reaching a pace of 10.7% in January 2016.

The central bank has cut the rate six times since the current easing cycle started last October.

Write to Jeffrey T. Lewis at jeffrey.lewis@wsj.com

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(END) Dow Jones Newswires

June 09, 2017 08:35 ET (12:35 GMT)