MNI BRIEF: Brazil Inflation Ends Year Above Copom Target

Brazil's IPCA inflation measure rose 0.52% in December, just a sliver below the 0.53% market consensus and down from 0.39% in November, the Brazilian Institute of Geography and Statistics (IBGE) said Friday, announcing a reading set to keep the country's central bank on a hawkish monetary tightening path. 

On an annual basis, in 2024 prices climbed 4.83%, leaving the rate above the central bank's 3% target range, which has a 1.5% tolerance band in either direction. The Committee on Monetary Policy (Copom) is expected to publish a letter later today outlining why it missed its price goal for the year. 

Brazil's economy has been experiencing a deepening crisis of confidence that has included a drop in the real currency to record lows against the dollar, and was exacerbated in November after the release of a budget that disappointed market expectations for more drastic cuts to spending. (See MNI INTERVIEW: Brazil Experiencing Confidence Crisis-Pires)