* Economists cut 12-month inflation view to 5.51 pct
* 2014 growth view trimmed to 3.5 pct
By Silvio Cascione
SAO PAULO, March 11 Brazil's central bank will
probably raise its benchmark interest rate this year to fight
inflation as the economy recovers, a weekly central bank poll
showed on Monday.
The Selic rate should end the year at 8.00 percent, up from
a record low of 7.25 percent, according to the median forecast
of about 100 economists surveyed last week. They maintained
their forecasts for end-2014 rate at 8.25 percent.
A Reuters poll on Thursday showed a slight majority of
economists expected an increase this year after the central bank
stopped forecasting stable rates for a long period.
The bank led by Alexandre Tombini, which cut the Selic rate
ten consecutive times between August 2011 and October 2012 to
boost Brazil's economy, has sought to calm inflation fears after
a surprise jump in consumer prices in the past few months.
The view of a rate increase this year already helped curb
inflation expectations, according to the poll. The outlook for
the benchmark IPCA price index in the next 12 months dropped to
a rise of 5.51 percent, from 5.62 percent in the prior week.
Inflation should end 2013 with an annual increase of 5.82
percent, the poll showed, up from 5.70 percent in the prior
week's survey. Government data on Friday showed a surprise rise
in consumer prices in February despite a government-sponsored
cut in electricity rates.
The central bank targets inflation at 4.5 percent, with a
tolerance margin of plus or minus 2 percentage points.
Economists also trimmed their forecasts for growth of Latin
America's largest economy in 2014 to 3.50 percent, from 3.65
percent in the previous poll. They raised their median estimate
for 2013 GDP growth to 3.10 percent, from 3.09 percent.
Brazil, the world's seventh-largest economy, grew only 0.9
percent last year.
In March, consumer prices are expected to rise 0.45 percent,
up from a previous forecast of 0.43 percent.
(pct) 2013 2014
previous new previous new
forecast forecast forecast forecast
Consumer inflation 5.70 5.82 5.50 5.50
Exchange rate 2.00 2.00 2.05 2.06
Interest rate 7.25 8.00 8.25 8.25
GDP growth 3.09 3.10 3.65 3.50
Industrial output 2.86 3.00 3.75 3.75