August 16, 2023 14:31 GMT
Itaú Increase Year-End Inflation Forecast To 5.1%
- Following the fuel prices adjustment, Itaú now expect a 5.1% increase in the IPCA this year (from 4.9%). Yesterday, Petrobras announced an increase in fuel prices, a movement that came in above Itau’s short-term expectations, which included a smaller adjustment in gasoline, close to 5%.
- As a result, the rise has an additional impact of approximately +25 bps in the months of August and September. Itaú have revised their 2023 IPCA forecast to 5.1% from 4.9%, however, maintain the forecast for the 2024 IPCA at 4.3%.
- On the one hand, a still tight labour market should continue to pressure service inflation next year. On the other, an additional drop in commodity prices or an acceleration in industrial inventory levels pose a downside risk for their forecast.