RIO DE JANEIRO: Brazil’s annual inflation rate fell for the 11th straight month in May, dropping below four percent for the first time since 2020, officials said Wednesday.

The rate fell to 3.94 percent, down from 4.18 percent in April, said national statistics institute IBGE – bolstering President Luiz Inacio Lula da Silva’s ongoing push for the central bank to make growth-spurring interest-rate cuts.

The annual inflation rate fell within the central bank’s current target range of 1.75 to 4.75 percent for a third straight month, hitting its lowest level since October 2020, when it stood at 3.92 percent.

Pakistan proposes inflation target of 21% in estimates for upcoming FY24 budget: report

The monthly inflation rate for May was 0.23 percent, down from 0.61 percent in April. That was lower than the 0.37 percent average forecast of analysts polled by the central bank.

Food inflation slowed from 0.71 percent in April to 0.16 percent in May, while lower fuel prices drove falling prices in the transport sector, where monthly inflation came in at -0.57 percent for May, IBGE said.

Lula, who took office in January, has called Brazil’s benchmark interest rate “absurd” at 13.75 percent, saying it is stunting the growth of Latin America’s biggest economy.

The veteran leftist renewed his criticism Tuesday, saying there is “no explanation for why we should have the highest interest rate in the world.”

But the central bank’s monetary policy committee has showed no signs of easing off its hawkish stance yet, citing lingering price pressures and expectations for inflation to rise again later this year.

It closed its last meeting on May 3 holding the key rate steady for the sixth straight time and calling for “patience.”

Brazil’s economy posted stronger-than-expected growth of 1.9 percent in the first quarter of the year.