Brazil's Rousseff denies inflation out of control

Rousseff downplayed the significance of the 6.52% annual inflation rate registered in June

Brazilian President Dilma Rousseff has denied that inflation was out of control even though it has breached the official target, addressing one of voters' main complaints ahead of October elections.

Rousseff, who is seeking a second four-year term, downplayed the significance of the 6.52% annual inflation rate registered in June, which broke the central bank's target limit of 6.5%.

"Inflation is not out of control. It's at the target ceiling," the leftist leader said at a candidate's forum organised by newspaper Folha de Sao Paulo yesterday.

"Today it's 0.02 above the target ceiling and is on a downward trajectory."

Rousseff said that in the 15 years since the central bank set its target band for inflation - 4.5% plus or minus two percentage points - there had been 12 years in which the figure broke the 4.5% target midpoint, including five years in which it broke the 6.5% target ceiling.

She said Brazil had absorbed the blow of the global economic crisis without a major rise in unemployment, which stood at 4.9% in April, the lowest in the country's history.

"Of the G20 countries, we were one of those that grew the most," she said.

The Brazilian economy has stalled during Rousseff's presidency, slowing from 7.5% growth in 2010 to 2.5% last year and a forecast of less than one% this year.

The stagnation, combined with rising prices, has fueled frustration among voters, though Rousseff remains popular with the millions of Brazilians lifted from poverty under her government and that of her predecessor and mentor, Luiz Inacio Lula da Silva.

She has 38% support ahead of the October 5 first-round election, compared to 22% for her main rival, social democrat Aecio Neves, and eight% for socialist Eduardo Campos, according to a survey last week by polling firm Ibope.