UPDATE 1-Brazil inflation tops 10 percent in November, a 12-year high

miércoles 9 de diciembre de 2015 08:53 GYT

(Adds details on food, fuel prices)
    By Silvio Cascione
    BRASILIA, Dec 9 (Reuters) - Brazil's annual inflation rate
climbed above 10 percent to a 12-year high in November, which
was more than expected and may force tighter monetary policy
despite a severe recession.
    Consumer prices measured by the benchmark IPCA index
 rose 10.48 percent in the 12 months through
November, up from an increase of 9.93 percent in October and
above a Reuters poll forecast of 10.41 percent, government
statistics agency IBGE said on Wednesday.
    The government targets inflation of 4.5 percent, a goal
analysts see as infeasible until at least 2017. To keep
inflation under control, the central bank has signaled it could
raise interest rates in January from a nine-year high of 14.25
    Brazil's inflation has gained steam in recent months as a
political crisis threatening to unseat President Dilma Rousseff
fueled a sharp currency devaluation. Food prices also picked up
as a strong El Niño weather pattern boosted rainfall in southern
    Food prices rose 1.8 percent in November, pushed up by fresh
produce such as potatoes and onions that are more susceptible to
weather conditions. Fuel prices jumped 4.6 percent as an
exchange rate near record lows increased costs at state-run oil
company Petroleo Brasileiro SA, which imports
gasoline for domestic consumption.
    On a monthly basis, the IPCA index rose 1.01
percent, compared with an increase of 0.82 percent in October.
    The price spikes have fueled popular discontent against
President Rousseff as Brazilians recall several bouts of
hyperinflation in the past century. 
    Current inflation is much milder than in previous episodes,
but it has been accompanied by the worst recession in decades.
Analysts forecast an economic contraction of more than 3 percent
this year and more than 1 million jobs lost.
    Yields on interest rate futures were little changed
<0#2DIJ:> as traders stuck to bets that the central bank would
raise interest rates in its next meeting, in January. 
    Below is the result for each price category:     
                                 November     October
 - Food and beverages                1.83        0.77
 - Housing                           0.76        0.75
 - Household articles                0.31        0.39
 - Apparel                           0.79        0.67
 - Transport                         1.08        1.72
 - Health and personal care          0.64        0.55
 - Personal expenses                 0.52        0.57
 - Education                         0.22        0.10
 - Communication                     1.03        0.39
 - IPCA                              1.01        0.82
 (Reporting by Silvio Cascione; Editing by Hugh Lawson and Lisa
Von Ahn)