Brazil's deflation rate of 0,68% is the lowest since the beginning of the historical series in 1980
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The Brazilian Institute of Geography and Statistics (IBGE) released new data this Tuesday morning on the Broad National Consumer Price Index (IPCA), which takes into account the country's official inflation. The drop in July was 0,68%, with deflation (negative inflation).
Compared to June, the index rose 0,67%, and last month's low was the first after a 25-month high. According to IBGE, this is the lowest value recorded since the beginning of the historical series that began in January 1980.
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cause of deflation
The accumulated inflation rate for 2022 so far is 4,77%. Compared to the last 12 months, interest rates slowed down, falling from 11,89% to 10,07%. But despite the July hiatus, annual inflation remains above double digits and well above the official target for 2022.
The main reasons for July's deflation can be attributed to the reduction in fuel prices and energy tariffs resulting from the reduction in the circulation of goods and services (ICMS), in addition to lower prices at Petrobras refineries.
Gasoline prices fell 15,48% and ethanol prices fell 11,38%. It is worth remembering that gasoline alone has a greater weight in the IPCA, ending up having a more significant impact on the 377 sub-items considered in the index.
The residential energy sector decreased by 5,78%, and the use of gas cylinders decreased by 0,36%.
Items that become more expensive and cheaper in July
Of the nine groups of products and services surveyed, only two showed deflation in July. Overall, the other 7 all have price increases. The drop in results can be attributed to the housing (-1,05%) and transport (-4,51%) groups.
See below
- Housing: -1,05%
- Transport: -4,51%
- Health and personal care: 0,49%
- Personal expenses: 1,13%
- Education: 0,06%
- Communication: 0,07%
- Household articles: 0,12%
- Clothing: 0,58%
- Food and beverages: 1,30%