Bovespa Index Futures Fall After Increase in Inflation Forecast

Bovespa-index futures fell as economists covering Brazil raised their forecasts for inflation this year, adding to concern that rising prices may curb the economic recovery.

Auto-parts maker Iochpe-Maxion SA may move after saying it plans to sell 320 million reais ($164.6 million) of local bonds that can be converted to voting shares. Vale SA, the world’s largest iron-ore producer, may move as metals declined.

Bovespa-index futures contracts expiring in April declined 0.5 percent to 58,380 at 9:06 a.m. in Sao Paulo. The real was little changed at 1.9448 per dollar.

Brazil’s consumer prices as measured by the IPCA index will rise 5.82 percent in 2013, according to the median estimate in a central bank survey of about 100 analysts published today. Economists had forecast a 5.70 percent increase the previous week.

The Bovespa has dropped 7.7 percent from this year’s high on Jan. 3 amid concern accelerating inflation may curb Brazil’s economic recovery and the government’s interventionist policies will hurt profits in industries including utilities and energy. The MSCI BRIC Index of shares in Brazil, Russia, India and China has slid 1.9 percent over the same period.

Brazil’s benchmark equity gauge trades at 11.8 times analysts’ earnings estimates for the next four quarters, compared with 11.1 for the MSCI Emerging Markets Index of 21 developing nations’ equities, data compiled by Bloomberg show.

Trading volume for stocks in Sao Paulo was 7.46 billion reais on Mar. 8, which compares with a daily average of 7.59 billion reais this year through March 6, according to data compiled by the exchange.