Brazil Nov. inflation surprises every economist surveyed

David Biller, Andre Soliani – Bloomberg Businessweek, 12/07/2012

Brazil’s inflation unexpectedly accelerated as central bank President Alexandre Tombini reiterated his plan to hold interest rates at their current level, while investors bet on more cuts next year.

Prices as measured by the benchmark IPCA index rose 0.6 percent in November, the national statistics agency said today in Rio de Janeiro, more than any economist forecast in a survey by Bloomberg. Swap rates jumped.

Tombini told reporters yesterday that the bank is standing by its monetary policy strategy after traders rocked markets with bets he will resume cutting borrowing costs. The bank yesterday released its minutes to last week’s monetary policy meeting and pledged to keep the Selic rate at a record low 7.25 percent for a prolonged period.

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