Brazil consumer prices slow down in mid-August

Brazil inflation eases: Consumer prices in Brazil slowed down in the month to mid-August, government statistics agency IBGE said on Tuesday, with annual inflation also coming in lower than in the previous print.

Prices as measured by the IPCA-15 index were up 0.19 per cent in the period, IBGE said, slowing from 0.30 per cent in July and basically in line with the 0.20 per cent increase forecast by economists polled by Reuters.

In the 12 months to mid-August, inflation in Latin America's largest economy stood at 4.35 per cent, down from the 4.45 per cent seen the month before and slightly below the 4.37 per cent expected by economists in the Reuters poll.

Still, eight out of nine sectors surveyed by IBGE posted price increases in the period, the agency said, with transportation the biggest influence on the back of higher gasoline costs.

On the other hand, airfare prices, which were a big reason behind a higher-than-expected inflation reading in mid-July, reversed course in the month to mid-August, falling 4.63 per cent on a monthly basis.

Food and beverage prices were also down.

Brazil's central bank targets inflation at 3 per cent, plus or minus 1.5 percentage points. The monetary authority has said that it would not hesitate to raise interest rates if necessary to bring inflation down to its target.