Inflation indexes in Brazil

Inflation in Brazil has been a significant challenge for the Brazilian economy, particularly throughout the 20th century.^[1] The first major inflationary cycle occurred in the 1940s, a period marked in its first half by the Second World War (1939-1945). During this decade, prices increased by 215.6% between 1940 and 1949, averaging 12.2% per year. After 1945, however, the government maintained fixed exchange rates for foreign currencies, which helped keep inflation at moderate levels.^[2]

In the 1950s, inflation accumulated nearly 460%, more than doubling the rates of the previous decade. Annual rates fluctuated between 12% and 40%, in a period characterized by structural transformations in the Brazilian economy. In the 1960s, the inflation rate rose from 30% in 1960 to over 90% in 1964. Following policies that included price controls, government budget cuts, and wage reductions, inflation declined to 35-40% in 1965-66, approximately 25% in 1967-68, and around 19% per year by the end of the decade.^[2]

During the 1970s, a period known as the "Brazilian Miracle", inflation reached annual levels of 80%. In the 1980s, Brazil experienced one of the longest periods of monetary instability in the post-war era. Inflation surged again, reaching 100% in 1981 and 1982, 200% between 1983 and 1985, and an overall price variation of 1,800% by the end of 1989. Monthly inflation reached approximately 50% in December 1989.^[2]

In the early 1990s, Brazil experienced three months of hyperinflation, and inflationary levels remained high, reaching rates of up to 3,000% per year. It was only in the mid-1990s, with the implementation of the Plano Real, that the Brazilian economy was stabilized.^[2]