MNI BRIEF: Brazil's Inflation 5.48% In March, Driven By Food

Brazil's IPCA inflation measure rose by 5.48% in March, in line with the 5.45% consensus and up from 5.06% in February, the Brazilian Institute of Geography and Statistics (IBGE) said Friday. The increase was driven by food prices.

Inflation remains above the upper limit of the Central Bank of Brazil's 3% target range, which allows for a 1.5-percentage-point deviation in either direction.

On a monthly basis, inflation was 0.56%, down from 1.31% and in line with the 0.53% consensus. "The food and beverages group accounted for 45% of the monthly index. The main increases were seen in tomatoes (22.55%), ground coffee (8.14%), and eggs (13.13%), which together contributed to a quarter of March’s inflation. Ground coffee alone has risen 77.78% over the past 12 months," IBGE said. 

The BCB raised its Selic rate by 100 basis points again last month to 14.25%, signaling at least one more, smaller increase in May. (See MNI INTERVIEW: BCB Might Cut Sooner as Activity Slows - Serra)