“Brazil swap rates rose as a measure of inflation accelerated, bolstering bets that policy makers will have to raise borrowing costs to tame price increases.
Swap rates on contracts due January 2015 rose four basis points, or 0.04 percentage point, to 7.74 percent, matching a one-week high reached on Jan. 4. The real gained 0.2 percent to 2.024 per U.S. dollar at 10:06 a.m. in Sao Paulo.
The Getulio Vargas Foundation’s IPC-S gauge, which monitors prices in Brazil’s seven biggest cities, rose 0.77 percent in the 30 days ending Jan. 7. The median estimate of 14 analysts surveyed by Bloomberg was for a 0.71 percent increase.
“Inflation numbers continue surprising on the upside and are one of the principal risks for 2013,” said Vladimir Caramaschi, the chief strategist at Credit Agricole Brasil SA (ACA), said in a phone interview from Sao Paulo.”
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