Brazil inflation to reach year low in mid-October
SAO PAULO (Reuters) - Brazil's inflation probably extended its decline into mid-October, reaching a new low for the year before it starts to accelerate again in the months ahead, a Reuters poll showed.
The IPCA-15 price index is expected to rise 5.69 percent in the 12-month period through mid-October, down from 5.93 percent in mid-September, according to the median of 22 forecasts in the survey.
The government's year-end inflation target is 4.5 percent, with a tolerance band of two percentage points either way.
Inflation broke out of the official target range in the first half of this year, prompting the central bank to unleash a long cycle of interest rate hikes.
Since then, inflation has moderated thanks to cooling food prices. However, that downward trend is seen coming to an end this month, which would keep Brazil's inflation above the middle of the target for a third consecutive year.
Month-on-month inflation will likely show increasing pressure on prices, with an expected rise of 0.41 percent, according to the median of 32 forecasts. Prices measured by the index rose 0.27 percent in mid-September.
"A higher inflation in the personal expenditures, food and apparel groups, the last two reflecting seasonal pressures, and a slower downward trend from fuel should be the release highlights," economists at Barclays wrote in a note on Friday.
Inflation is expected to end this year at 5.81 percent, according to a weekly central bank poll of economists.
National statistics agency IBGE will release its inflation figures on Friday at 9 a.m. local time (1200 GMT). Forecasts for the monthly increase ranged from 0.35 to 0.50 percent, while estimates for the annual rise ranged from 5.60 to 5.79 percent.
(Reporting by Silvio Cascione; Editing by Carol Bishopric)
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