Brazil’s Economy Minister asks supermarkets not to raise prices

Brazil’s Economy Minister Paulo Guedes has publicly called on supermarkets to stop raising prices in the coming months, as the government struggles to curb inflation, which poses a serious challenge to the economy. candidacy for re-election of President Jair Bolsonaro.

Bolsonaro is asking for a “price truce”Guedes said Thursday at an event organized by the Brazilian supermarket association Abras, just after the president himself had requested the sector’s collaboration.

“Now is the time to put the brakes on higher prices. It is voluntary and for the good of Brazil,” Guedes said. “Let’s stop raising prices for two or three months. We are at a decisive moment for Brazil.”

Latin America’s largest economy has struggled inflation that has exceeded 10% for nine straight months, even as the central bank extends its aggressive interest-rate hike cycle. Soaring food and fuel costs have reduced purchasing power and slowed economic growth.

Consumer prices also represent the voters’ main concern before the presidential elections in October.

Inflation started to ease in May, Guedes said, after official data on Thursday showed that consumer prices rose less than expected last month.

Several initiatives aimed at cushioning the blow of inflation, including the temporary elimination of some fuel taxes, are currently making their way through Congress. But the fiscal implications of the measures are weakening the real, a trend that could end up making imports more expensive.

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