January 13, 2020

Brazil's beef exports push country's consumer inflation beyond central bank target

Government statistics agency IBGE said higher meat prices have pushed consumer prices in Brazil higher than normal last year, surpassing economists' forecasts, reported Reuters.

Meat prices in Brazil rose 18.06% compared to the previous month thanks to an increase in beef exports to China. In 2019, meat prices increased 32.4%.

China has approved additional meat sources globally for import to supplement dwindling pork supplies caused by the African swine fever outbreak.

Brazil's consumer inflation rate in 2019 hit 4.31%, higher than the official end-year goal of 4.25% forecasted by the central bank. The bank has a tolerance margin of 1.5 percentage points on either side.

This value was higher than the 3.75% posted in 2018.

A Reuters poll of economists set the median forecast at 4.23% for Brazil's annual inflation rate. The benchmark IPCA index increased 1.15% in December, the highest increase compared to the previous month since 2002 and beyond economists' forecast of 1.08%.

-      Reuters