Brazil’s inflation rose by 0.83 percent in May, according to consumer price index IPCA. It was the steepest spike for the month since 1996, according to the Brazilian Institute of Geography and Statistics (IBGE). The boost was propelled by an increase in household expenditures, with both electricity and gas bills becoming more expensive during the month.
May’s spike exceeded the 0.70-percent increase predicted by markets and the 0.52-percent jump seen in April. Over the last 12 months, inflation now stands at 8 percent, far beyond the government’s 5.25 percent target.
The 5.37 percent spike in electricity prices comes during a water crisis in Brazil, forcing the national energy system to resort to more expensive sources. In May, consumers’ bills were increased by the so-called “red tariffs,” which add BRL 4.17 for every 100 kilowatts-hour consumed.