Brazilian inflation ended last year above the government’s 2-to-5-percent target band for the third year in a row. Still, by international standards, Brazil’s 12-month consumer price increase was only the world’s 144th highest in 2022. Inflation in Latin America’s largest economy had never been so low since 2007. But the Central Bank seems unimpressed by the country’s recent inflation slowdown.
Consumer prices rose 4.65 percent in the year through March, down from 11.3 percent a year earlier. But Central Bank head Roberto Campos Neto, speaking at an event with business leaders and policymakers, pointed out that core inflation — which strips out volatile prices and seasonal factors — is stubbornly high.
Core inflation measures give a clearer picture of price trends. According to the Brazilian Institute of Economics at think tank Fundação Getulio Vargas, 12-month core inflation was 5.84 percent in February, the latest data available, higher than headline inflation.
In the event, the central banker dashed hopes that the monetary authority will signal interest rate cuts at its upcoming policy meeting next week. Mr. Campos Neto said that the “yearning for a drop in interest rates is political, but our work is technical.” He suggested that the conditions for a cut in the benchmark rate, currently...
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