Wednesday July 8, 01:59 PM
UPDATE 1-Brazil inflation slows in June, edges up 0.36 pct
SAO PAULO, July 8 (Reuters) - Inflation in Brazil lost some steam in June as a spike in the cost of food and beverages was offset by slower gains in prices of personal items and housing, government data showed on Wednesday.
The benchmark IPCA consumer price index rose 0.36 percent in June, slowing down from a 0.47 percent increase in May, the government's statistics agency IBGE said.
The index was expected to climb 0.31 percent last month, according to the median forecast of 25 economists surveyed by Reuters. Estimates ranged from 0.28 percent to 0.34 percent.
The IPCA has now risen 2.57 percent so far in 2009 and 4.8 percent in the 12-month period through June, easing from its 5.2 percent advance in the 12 months through May, the IBGE said.
Brazil's central bank, which uses the IPCA as a gauge when setting interest rates, has a 4.5 percent inflation target for this year, with a tolerance band of plus or minus 2 percentage points.
The easing inflation rate could allow the central bank to keep cutting interest rates to stoke the country's economic rebound. Brazil's economy, Latin America's largest, slipped into recession in the first quarter of this year but has been showing signs of recovery.
Four of the nine price categories of the IPCA index slowed their advance in June, as compared with May, and one showed a decline in prices. That helped offset a 0.7 percent jump in the cost of food and beverages in June, which accelerated from a 0.44 percent gain in May.
The housing component of the index edged up 0.27 percent in June after rising 0.72 percent in May, while the personal expenses category climbed 0.49 percent following a 1.57 percent surge the previous month.
For more details on the IPCA report for June, see: http://www.ibge.gov.br/home/presidencia/noticias/noticia_visualiza.php?id_noticia=1408&id_pagina=1
(Reporting by Todd Benson and Rodrigo Viga Gaier, editing by W Simon) Keywords: BRAZIL ECONOMY/INFLATION
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