Brazil's annual inflation rate in the first half of January rose above the central bank's target for the first time since 2006, pushed up by food prices.

Inflation, as measured by the government's IPCA-15 consumer price index, quickened to 4.55 percent in the year through Jan. 14 from 4.36 percent in month-earlier period. The annual rate last topped 4.5 percent in April 2006.
Brazil's Central Bank Wednesday elected to hold interest rates unchanged for a third meeting to gauge whether a recent surge in prices will threaten the bank's year-end inflation target.
Accelerating food price inflation coupled with the fastest economic expansion since 2004 led policy makers to pause in October, snapping the longest easing cycle since Brazil adopted inflation targets in 1999.
“he risk of rate increases has risen and today's report brings no relief,” said Zeina Latif, an economist at ABN Amro Real in Sao Paulo. “till, policy makers have the credibility now to allow them to wait for clearer signs that inflation will exceed their target this year before deciding to hike.”
Economists raised their forecasts for annual inflation to 4.31 percent from less than 4 percent in November, according to a central bank survey published Jan. 21. The bank targets inflation of 4.5 percent, plus or minus 2 percentage points to accommodate price shocks.
In a separate report released today, unemployment in December fell to its lowest rate since the government began a new series of the indicator in 2002 as companies added staff to meet rising demand.
Unemployment in Brazil's six largest metropolitan areas dropped to 7.4 percent in December from 8.4 percent in the year- earlier month and 8.2 percent in November, the agency said in a release distributed in Rio de Janeiro.
(Source: Bloomberg)