Brazil CPI Falls to 3.81% in February: Inflation Eases Further
Brazil’s consumer price index (CPI) for February 2026 registered a year-over-year increase of 3.81%, according to official data released March 12. This marks a notable deceleration from January’s 4.44% pace and comes in below the consensus estimate of 3.77%[1].
Big-Picture Snapshot
Drivers this month
- Food and beverages: +0.12pp
- Transportation: -0.09pp
- Housing: +0.07pp
Policy pulse
February’s 3.81% CPI sits comfortably within the Banco Central do Brasil’s 2026 inflation target range of 3.0% ±1.5pp[1].
Market lens
Brazilian government bonds rallied on the softer CPI print. The drop in annual inflation has fueled expectations that the central bank will maintain its current policy stance, with investors reassessing the risk profile of local assets.
Foundational Indicators
Historical context
- February 2026: 3.81% YoY
- January 2026: 4.44% YoY
- December 2025: 4.26% YoY
- October 2025: 4.94% YoY
Trend signals
Annual CPI has now fallen for two consecutive months, with February’s reading the lowest since October 2023. The 12-month average stands at 4.41%.
Policy pulse
With inflation below the midpoint of the central bank’s target, policymakers are likely to emphasize vigilance while monitoring core inflation components.
Chart Dynamics
Forward Outlook
Scenario analysis
- Bullish (25%): Sustained disinflation, CPI dips below 3.5% by mid-2026 as food and energy prices stabilize.
- Base (60%): CPI hovers between 3.5% and 4.2% through Q2, with moderate volatility in core components.
- Bearish (15%): Supply shocks or currency weakness push CPI back above 4.5% in coming months.
Risks and methodology
Upside risks include global commodity volatility and domestic fiscal pressures. Downside risks stem from weak demand and favorable base effects. Data sourced from Sigmanomics and IBGE, using headline CPI methodology with monthly and annual comparisons.
Closing Thoughts
Market lens
Equities and the real saw modest gains as inflation undershot expectations. Investors are recalibrating positions in anticipation of a stable policy environment, with local assets benefiting from the improved inflation outlook.
Policy pulse
With CPI now below the midpoint of the target band, the central bank’s communication will focus on anchoring expectations and monitoring second-round effects.
Key Markets Reacting to CPI
Brazil’s CPI release has immediate effects across asset classes. Fixed income markets respond to inflation surprises, while currency and equity markets adjust to shifting policy expectations. Below are key tradable symbols from verified Sigmanomics listings, each with a brief note on CPI sensitivity.
- AAPL (US equities): Often inversely correlated with EM inflation surprises, as global risk sentiment shifts.
- EURUSD (Forex): Moves as BRL volatility impacts global FX flows and risk appetite.
- BTCUSD (Crypto): Sometimes viewed as an inflation hedge in EM contexts, with flows tracking CPI surprises.
| Year | CPI YoY (%) | AAPL (YoY %) |
|---|---|---|
| 2023 | 3.16 | 48.2 |
| 2024 | 4.62 | 7.1 |
| 2025 | 4.94 | 32.9 |
| 2026 YTD | 3.81 | 8.7 |
Since 2020, AAPL’s annual returns have shown little direct correlation with Brazil’s CPI, but global risk sentiment often amplifies moves in both during inflation surprises.
FAQ
- What is the latest Brazil CPI figure?
- Brazil’s February 2026 CPI rose 3.81% year-over-year, down from January’s 4.44%.
- How does this CPI reading compare historically?
- February’s 3.81% is the lowest annual inflation since October 2023, continuing a two-month disinflation trend.
- What does “Brazil CPI Falls to 3.81% in February: Inflation Eases Further” focus on?
- The article analyzes Brazil’s latest CPI data, key drivers, market reaction, and policy implications.
Brazil’s inflation momentum has cooled, with February’s CPI print undershooting expectations and supporting a stable policy outlook.
Updated 3/12/26
This has been drafted with AI assistance and then thoroughly reviewed, refined, and approved by our human editorial team to ensure accuracy, and originality.
- Sigmanomics Economic Data Platform, Brazil CPI, accessed March 12, 2026.
- Banco Central do Brasil, Inflation Targeting Framework, accessed March 2026.
- IBGE (Instituto Brasileiro de Geografia e Estatística), Official CPI Releases, February 2026.
February’s CPI print of 3.81% compares to January’s 4.44% and a 12-month average of 4.41%. The latest figure marks a 0.63 percentage point drop from the prior month, continuing a steady disinflation trend since October’s 4.94% peak.
Monthly inflation momentum also eased, with February’s MoM change at 0.84%, down from December’s 0.25%. The recent deceleration reflects softer food prices and a moderation in transportation costs.