Vitor Abdala         Reporter Agência Brasil

Rio de Janeiro – Although official inflation as measured by the Broad Consumer Price Index (“IPCA”) has slowed down, monthly increases in the rate having gotten smaller for five consecutive months, the fact is that the IPCA rose 3.87% in the first half. That is the highest first half inflation rate since 2003, when it was 6.64%.

In the first half of 2010, inflation rose 3.09%.

According to Eulina dos Santos who is the coordinator of the Price Index division at the government statistical bureau (“IBGE”), one of the reasons for higher inflation is that the prices of services have jumped. She points to the fact that as family income rises, people will continue to use services considered essential even though they are more expensive. Thus, hairdressers and manicurist, for example, are charging more, but women continue to go to beauty salons. Another segment where prices rose is where the government controls or monitors them (“itens administrados e monitorados”) such as transportation, fuels and lottery tickets.

Cumulative official inflation for the last 12 months was 6.71%, which is the highest for a twelve-month period ending in July since 2005, when it was 7.27%.

Allen Bennett – translator/editor The News in English

Link - Apesar de redução do ritmo em junho, primeiro semestre tem maior inflação desde 2003