Clothing prices bursting at the seams

Despite a stronger currency in 2025, Brazilian consumers continue to pay significantly more for clothes than their international counterparts, according to a new retail industry report by investment bank BTG Pactual.

BTG Pactual launches its so-called “Zara Index” every January, tracking prices charged by the Spanish fast-fashion retailer across 54 countries and serving as a gauge of disparities. Zara items were 3% more expensive in Brazil than in the US last year, despite the Brazilian real gaining 15% against the US dollar in the same period. When adjusted for purchasing power parity (PPP) — a measure that accounts for local income levels — Brazilian consumers effectively paid 123% more than Americans for the same items.

The gap has narrowed slightly from the previous year, when Zara products in Brazil were 7% cheaper in dollar terms (due to a 21% currency devaluation in 2024) but 135% more expensive when adjusted for PPP. However, Brazil remains among the most expensive markets globally for the brand, alongside countries like India, Thailand and Malaysia.