Brazil Inflation Moderates But Services Price Pressures Remain

• Consumer price increases in Brazil likely remained subdued in March, but services continued to show worrying increases • Annual headline IPCA inflation rate probably dropped closer to 3.5% target midpoint as previous jump in education costs faded
• Median forecast is for 4.01% annual rate and 0.25% monthly rate in March • Central bank governor warned of "contamination" in services prices from wage gains and high inflation expectations • Much depends on Brazilian real's resistance to currency volatility threats that could hit consumer prices