The inflation has been on the rise since January when the government initiated a number of austerity measures and tax increases aiming at balancing overall budget. The new taxes have raised the prices of basics like electricity, bus fares and gasoline. The government has been trying to fight inflation by increasing the borrowing cost. In fact, since September of 2014, the Selic overnight lending rate was raised by 225 basis points to 13.25 percent.
Month-on-month, inflation rate reached a five-month low of 0.71 percent compared to 1.32 percent reported in March. Housing and utilities inflation slowed to 0.93 percent from 5.29 percent in March. Electricity cost rose 1.31 percent, much lower than a 22.08 percent increase in March when higher fees were introduced. Transport prices grew only 0.11 percent (0.46 percent in March) and cost of food and nonalcoholic beverages rose by 0.97 percent (1.17 percent in March). In contrast, higher inflation was reported for health and personal care (1.32 percent from 0.69 percent); apparel (0.91 percent from 0.59 percent); household articles (0.66 percent from 0.35 percent); personal expenses (0.51 percent from 0.36 percent) and communication (0.31 percent from -1.16 percent).