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BCB Governor Expecting 0.4 PP Impact To IPCA Inflation

BRAZIL
  • According to central bank Governor Roberto Campos Neto, Brazil will likely need to upwardly revise its inflation estimates following the news that Petrobras announced a fuel price hike earlier in the day. As a reminder, Petrobras said it will raise average gasoline prices by 16.3% to 2.93 reais per litre beginning Wednesday, while diesel prices will be increased by 25.8% to 3.80 reais per litre.
  • Campos Neto said the move's impact on inflation is expected to amount to around 0.4 percentage points between August and September. It will be interesting to see next Monday’s results of the latest Focus survey of economists to analyse whether a significant adjustment is made to year-end calculations.
  • Economists from JP Morgan Chase & Co raised their August inflation forecast to 0.19% from 0.12%, and September’s to 0.36% from 0.25%.
  • Brazil’s statistics agency is set to release mid-August inflation data next week.

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