Key facts
- Brazil's annual inflation rate slowed to 4.64% in June.
- The consumer price index (IPCA) decelerated from 4.72% in May.
- Lower motor fuel prices helped offset higher electricity bills.
- Food and beverage costs decelerated to an annual 3.82% in June.
- Brazil's central bank lowered its target rate to 14.25% in June.
Brazil's inflation slowed to an annual rate of 4.64% in June, a deceleration from 4.72% in May, according to data from the national statistics agency IBGE. This slowdown was primarily driven by lower motor fuel prices, which helped to offset increases in electricity bills.
Housing costs, a significant contributor to the index, saw their annual rate decelerate to 5.85% from 6.22% in May, largely due to tax readjustments for power supply in some southern states. Food and beverage costs, a major component of the index, also contributed to the monthly decrease, decelerating to an annual 3.82% from 3.87% in May, with lower prices for coffee, fruits, and meat cited as key drivers.
Transport costs slowed to 3.95% in June from 4.05% in May, influenced by decreased prices for ethanol, diesel, gasoline, and compressed natural gas, despite a rise in airfares. The annual inflation gain for June was notably lower than the 5.35% recorded in June 2025.
Inflation expectations, as surveyed by the central bank, remain above the target, with forecasts at 5.3% for 2026 and 4.18% for 2027. In line with efforts to manage inflation, Brazil's central bank reduced its target interest rate to 14.25% in June.