Brazil Analysts Forecast Fastest Growth in 24 Years

Brazil’s economy will expand in 2010 at the fastest pace in 24 years, pushing inflation above target through 2011, a central bank survey said.

Latin America’s biggest economy will expand 6.26 percent this year, compared with a week-earlier forecast of 6.06 percent, according to the median forecast in a May 7 central bank survey of about 100 economists published today.

To bring consumer prices back to the government’s 4.5 percent target, policy makers meeting in June will raise the benchmark interest rate to 10.25 percent, up from 9.5 percent, the same survey shows. Central bankers, after keeping the overnight rate at a record low of 8.75 percent for nine months, lifted the rate to 9.5 percent last month.

Economists expect inflation to quicken to 5.5 percent by year-end, up from 5.26 percent in April, the central bank survey shows. Inflation will slow to 4.8 percent next year.

The real gained 2.9 percent to 1.7845 per dollar at 8:19 a.m. New York time.