Inflation in Brazil has eased for second consecutive month, which takes some pressure of the central bank to hike rates further or go for a mega hike. Real has also gained pace last month after the central bank promised to do whatever it takes to stem Real's slide.
Real has strengthened to 3.84 per Dollar after touching new all-time high of 4.247 per Dollar.
Consumer prices as measured by Brazil's IPCA index has fallen to 9.49% in last 12 months to September compared to 9.56% as of July.
Though this fall is definitely a welcome it is still running way above central bank's target of 4.5%.
In response to higher inflation and Real's slide central bank has pushed interest rates from record low of 7.25% from October 2012 to nine year high of 14.25% as of now. However it chose to hold policy steady on September 2nd after seven consecutive hikes.
One of Brazil's key commodity exports, sugar has risen sharply in recent days. After making $10 bottom price has risen somewhat 20% from there (October contract).
Focus will be on Brazil, to see whether the economy is at a turnaround point or it's just a temporary relief.


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