Abstrak

This articles studies the relationship between inflation and GDP growth after trade and financial liberalisation in Brazil. The aim is to provide an explanation for the inverse relationship between economic growth and inflation verified in this economy in the considered period. Tradeable and non-tradeable inflation experiences are studied separately for this purpose. The article suggests a model for the relationship between inflation and economic growth under the cost-based price approach. The model is estimated for the case of Brazil, confirming the relationships postulated in the article.