FX.co ★ Brazil Inflation Slows in July

In July 2025, Brazil's annual inflation rate decelerated to 5.23%, down from 5.35% in June, and falling below the anticipated market projection of 5.33%. The central bank maintained the interest rate at 15% in efforts to manage living cost pressures, emphasizing the importance of staying vigilant against inflation rates that exceed targets, alongside managing the ongoing repercussions from the trade war initiated by U.S. President Donald Trump. The deceleration in inflation was primarily due to slower price increases in sectors such as transport, which saw a rise of 3.6% compared to 5.11% in June, clothing at 4.12% down from 4.68%, education at 6.15% from 6.21%, and communication reducing to 1.89% from 2.16%. Conversely, there was an acceleration in inflation rates for food and beverages at 7.44%, up from 6.66%, housing at 5.44% from 5.3%, healthcare at 5.4% compared to 5.16%, and personal expenses at 6.07% from 5.81%. On a month-to-month basis, consumer prices saw an increase of 0.26% in July, slightly up from 0.24% in June.