Brazil's Inflation Hits 4.83% in 2024

Brazil's annual inflation for 2024 ended at 4.83%, above the central bank's target of 4.5%, driven primarily by increasing food prices due to adverse weather conditions affecting crops. The central bank is expected to implement further interest rate hikes to combat inflation, which has been influenced by strong economic activity and high labor demand. In response to the recent economic challenges, Finance Minister Fernando Haddad reported a projected economic growth of 3.6% for the year and indicated that the government likely met its goal of eliminating the primary deficit. However, the devaluation of the Brazilian real, which fell 27% against the dollar, has raised inflation expectations and led to tighter monetary policy. Haddad acknowledged the need for improved communication with markets amidst a sensitive global economic environment. Despite these challenges, Lula remains optimistic about Brazil's economic strength and growth prospects.