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Brazil's inflation might end up lower than US inflation next month

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Headline rate of inflation in August was 8.73% compared to 12 months ago. The month-on-month change was negative (-0.36%). This is the second month in a row they experienced deflation.

source

The central bank expects inflation to be 6% by the end of the year.

So how have they achieved this?

They were the first central bank to start raising interest rates, back in March 2021, when other central banks sat on their hands claiming inflation was "transitory".

They were also very aggressive, taking interest rates from 2% in March 2021 to 13.75% in August 2022. That's right - interest rates are higher than the inflation rate in Brazil.

As Volcker proved, and now Brazil are proving, only aggressive rate rises tame inflation.