Brazil's FIPE inflation slows to 0.27 pct in July

Aug 3, 2007 - Consumer prices in Brazil's largest city, Sao Paulo, rose 0.27 percent in July, slowing from June's 0.55 percent rise, as food prices rose less and housing costs dipped, the Fipe research institute said on Friday.

The rise was slightly lower than the median forecast of 0.32 percent in a Reuters survey of economists.

Clothing prices fell 0.62 percent and transport costs extended their drop to 0.38 percent after 0.16 percent the previous month. Food prices rose the most, by 1.06 percent, but much less than in June, when the rise was of 1.9 percent, due to a seasonal decline in output of certain crops.

The Fipe index is closely watched by economists for trends in Brazil's benchmark IPCA inflation index, which is used by the central bank to set interest rates.