Inflation bursts Brazil’s tolerance band

Brazil's headline inflation rate slowed to 0.58% in May from 0.67% in April, statistics agency IBGE reported this morning. On its own, that sounds like relief. However, the 12-month IPCA inflation index — the gauge that actually guides monetary policy — hit 4.72% through May, breaking past the upper limit of the Central Bank's tolerance band (4.5%) for the first time since October 2025.