UPDATE 1-Inflation expectations rise after Brazil c.bank decision - poll

lunes 25 de enero de 2016 07:54 GYT

(Adds background)
    BRASILIA, Jan 25 (Reuters) - Inflation expectations in
Brazil rose sharply last week after the central bank kept
unexpectedly held interest rates steady, a central bank poll of
economists showed on Monday.
    Median forecasts for inflation in 2016 and 2017 rose to 7.23
percent and 5.65 percent respectively, up from 7.00 percent and
5.40 percent in the prior week's survey, according to the survey
of about 100 economists.
    The government targets inflation at 4.5 percent. 
    The central bank surprised investors last week by holding
interest rates steady at 14.25 percent despite having promised
to do "whatever was necessary" to lower inflation below 6.5
percent in 2016. 
    Economists said the decision raised questions of political
interference from leftist President Dilma Rousseff, whose
government is worried that higher rates will hamper plans to
revive the economy. 
    Most Brazilians have endured bouts of hyperinflation until
the creation of the real currency in 1994. Although the current
spike is not nearly as severe as previous episodes of runaway
inflation, it has helped erode the popularity of Rousseff
struggling with a corruption scandal involving lawmakers from
her Workers' Party and allied parties.
    Brazil is set to have both the worst recession and the
third-highest inflation rate among G20 economies in 2016,
according to Reuters Polls. 
 (pct)                2016                 2017
                      previous   new       previous  new
                      forecast   forecast  forecast  forecast
 Consumer inflation   7.00       7.23      5.40      5.65
 Exchange rate        4.25       4.30      4.30      4.40
 (reais per U.S                                      
 dollar, end-period)                                 
 Interest rate        15.25      14.64     12.88     12.75
 GDP growth           -2.99      -3.00     1.00      0.80
 Industrial output    -3.47      -3.57     1.80      1.50
 (Reporting by Silvio Cascione Editing by W Simon)