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UPDATE 1-Economists raise Brazil 2012 inflation view to 4.98 pct

by on July 30, 2012 12:04 pm GMT
 

Mon Jul 30, 2012 8:04am EDT

* Analysts see interest rates at 7.5 pct by end-2012

* Brazil economy to grow 1.9 pct this year – c.bank poll

(Reuters) – Private-sector estimates on
the outlook for Brazil’s economic growth were little changed
last week, a central bank survey showed on Monday, though
economists raised their estimates for inflation this year for
the third week in a row.

Forecasts for economic growth and interest rates were
unchanged, according to the poll, which tracks weekly forecasts
of the most widely watched indicators in Brazil.

Economists raised their forecasts for inflation this year to
4.98 percent from 4.92 percent in the prior week as recent price
indexes showed a spike in food costs.

Prices are expected to rise faster in 2013 with the IPCA
index seen accelerating to 5.50 percent, unchanged from last
week’s prediction. That is still within the central bank target
of 4.5 percent plus or minus 2 percentage points.

The outlook for Brazil’s economic growth in 2012 remained at
1.9 percent, according to the survey.

That would be the weakest growth in the world’s
sixth-largest economy since 2009, when it contracted slightly,
and a far cry from the 7.5 percent boom in 2010.

Analysts also kept their view on the next monetary policy
move unchanged. The central bank is forecast to cut interest
rates to a record low of 7.5 percent in August, where it will
stop to assess whether the economy has improved as expected.

The survey’s results are the median forecast of analysts
polled by the central bank at about 100 financial institutions.

Consumer prices were seen rising 0.26 percent in July from
the previous month, up from a prior week’s estimate of 0.25
percent.