Brazil’s annual inflation rate eased to 4.22% in August 2026 from 4.44% in July, slightly below forecasts of 4.27% and moving further within the central bank’s target range of 1.50%-4.50%. Price growth slowed for housing (4.90% vs. 5.93%), clothing (3.25% vs. 3.87%), transport (3.04% vs. 3.64%), health and personal care (5.84% vs. 6.16%), and education (5.98% vs. 6.27%). The moderation in transport costs was partly driven by easing fuels and energy inflation, which fell to 4.60% from 7.60%. Although oil prices surged internationally amid tensions in the Middle East, Petrobras refrained from immediately passing on the external volatility to its refineries, resulting in a cumulative gap relative to international market prices. On a monthly basis, consumer prices declined 0.32%, following a marginal 0.1% increase in July. CPI has risen 3.11% year to date.