BRASILIA, Dec 23 (Reuters) - Brazil's central bank expects inflation to remain high next year despite a lackluster economy, but price increases will likely ease to bring the index closer to the center of the official target in 2016.
In its quarterly inflation report released on Tuesday, the bank lowered its 2014 economic growth forecast to 0.2 percent from 0.7 percent in its previous estimate - a long way from its initial forecast for an expansion of 2 percent.
It estimated that the economy would likely grow at an annual rate of 0.6 percent in the third quarter of 2015.
The bank raised its 2014 inflation forecast to 6.4 percent from 6.3 percent previously.
For 2015, the bank raised its inflation forecast to 6.1 percent from 5.8 percent previously, but then sees inflation easing further to 5 percent in 2016. The central bank aims to keep annual inflation at the center of the official range of 2.5 percent and 6.5 percent. (Reporting by Alonso Soto and Silvio Cascione; Editing by Alison Williams)