UPDATE 2-Brazil's c.bank chief: Won't let inflation spread

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BRASILIA, May 28 (Reuters) - Brazil's central bank is determined to prevent wholesale inflation from spreading to consumer prices, bank chief Henrique Meirelles said on Wednesday.

He said it was important for inflation to stay close to Brazil's annual target of 4.5 percent and that he was not surprised with the current path of inflation.

Banks this week increased their inflation forecasts for this year to 5.24 percent from 5.12 percent last week.

"What is happening today in the Brazilian economy has already figured in our risk scenario. ... The good news is that the central bank has acted in the nick of time. That means we won't be delayed in the future," Meirelles said during testimony to Congress, referring to last month's interest rate hike.

Markets are betting on another 50 basis point hike in the Selic rate by the central bank next week after its 50 basis point hike last month -- the first increase in three years.

The latest figures showed inflation slowing in the month to mid-May as a surge in food prices was partially offset by lower electricity costs. But other recent evidence of building price pressures has fueled expectations of further rate hikes in Latin America's largest economy.

A range of top Brazilian officials, including President Luiz Inacio Lula da Silva, have said in the past few days that inflation pressures must be contained.

Inflation in Brazil has largely been blamed on surging consumer demand and rising global food prices.

Speaking of the U.S. economic slowdown, credit crisis and record world oil prices, Meirelles said there were some concerns that a setting similar to the 1970's oil crisis could repeat itself if central banks around the world do not stick to a rigid monetary policy.

But he pointed out central banks are now legally independent and more committed to stability.

"The higher probability is that the central banks take adequate measures," he said, noting recent interest rate hikes in some countries, without giving specific examples.

With the U.S. economy showing signs of "weak growth under the best of hypotheses" and a possible recession looming, and serious concern about a slowdown in Europe, Meirelles said emerging economies including Brazil have demonstrated "a much higher resilience than was expected." (Reporting by Isabel Versiani; Writing by Ana Nicolaci da Costa and Andrei Khalip; Editing by Leslie Adler)