Brazil’s September Inflation Surprise: IPCA-15 Rises Less Than Expected
Brazil’s September inflation rate unexpectedly slowed, according to the latest data from the Brazilian Institute of Geography and Statistics (IBGE).
The National Consumer Price Index-15 (IPCA-15) rose by 0.13% in September, marking a deceleration from August’s 0.19% increase.
This inflation figure came in significantly below market expectations. Analysts had predicted a 0.29% increase, making the actual result less than half of what was anticipated.
The housing sector contributed the most to the inflation rate, with a 0.50% increase and an impact of 0.08 percentage points.
The IPCA-15 has accumulated a 3.15% increase in the first nine months of 2024. Over the past 12 months, the inflation rate stands at 4.12%, down from 4.35% in the previous month.
These figures remain within the Central Bank’s target range for 2024, which aims for 3% with a tolerance of 1.5 percentage points in either direction.
Key Factors Influencing Inflation
Residential electricity costs played a significant role in the housing sector’s inflation. Prices jumped from a 0.42% decrease in August to a 0.84% increase in September.
This shift was primarily due to the implementation of the red tariff flag level 1. Water and sewage rates also contributed to the housing sector’s inflation.
Several cities experienced tariff adjustments, including São Paulo, Salvador, and Fortaleza. These changes resulted in an overall increase of 0.38% in water and sewage rates.
The food and beverages group showed a slight increase of 0.05% after two months of decline. While some items like onions, potatoes, and tomatoes saw price decreases, others such as papaya, bananas, and ground coffee experienced price hikes.
Transportation and Other Sectors
The transportation sector experienced a slight deflation of 0.08%. This decrease was largely due to a 0.66% drop in gasoline prices.
However, air travel costs increased by 4.51%, partially offsetting the overall decrease in the transportation category.
Other sectors that saw price increases included health and personal care (0.32%), household items (0.17%), and clothing (0.12%).
Education and communication sectors showed minimal increases of 0.05% and 0.07% respectively.
This unexpected slowdown in inflation provides a positive outlook for Brazil’s economy. It suggests that inflationary pressures may be easing, potentially influencing future monetary policy decisions by the Central Bank.
Brazil’s September Inflation Surprise: IPCA-15 Rises Less Than Expected
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Brazil — Live Market Board
+0.73%
178,721.76
+0.73%
65,430.32
-0.08%
11,315.26
-1.14%
3,070,880
+1.22%
2,467.03
+1.73%
59,450.29
+0.04%
| Instrument | Last | Change | YoY | Prev. | High | Low | Volume |
|---|---|---|---|---|---|---|---|
| IBOV | 178,721.76 | +0.73% | +21.85% | 177,418.78 | 168,310 | 167,142 | — |
| USD/BRL | 5.16 | +0.01% | -5.13% | 5.16 | 5.18 | 5.14 | — |
| SELIC | 14.00% | — | — | — | — | — | |
| PETR4 | 41.64 | -0.05% | +35.19% | 41.66 | 41.97 | 41.15 | 41,499,400 |
| VALE3 | 72.97 | +0.83% | +30.75% | 72.37 | 73.54 | 72.66 | 17,658,000 |
| ITUB4 | 38.60 | -1.03% | +4.57% | 39.00 | 39.34 | 38.39 | 29,487,800 |
| BBDC4 | 16.85 | +0.36% | +3.50% | 16.79 | 16.90 | 16.67 | 19,416,900 |
| BBAS3 | 19.37 | +0.47% | +0.73% | 19.28 | 19.44 | 19.16 | 11,069,200 |
| B3SA3 | 14.26 | -0.21% | +12.73% | 14.29 | 14.47 | 14.11 | 33,037,800 |
| ABEV3 | 14.89 | -0.80% | +21.91% | 15.01 | 15.07 | 14.81 | 16,453,100 |
| WEGE3 | 47.59 | +0.49% | +29.99% | 47.36 | 48.08 | 47.36 | 3,364,600 |
| PRIO3 | 59.14 | -0.19% | +50.67% | 59.25 | 59.81 | 58.74 | 3,325,600 |
| SUZB3 | 41.33 | +2.35% | -23.55% | 40.38 | 41.48 | 40.35 | 3,914,900 |
| RENT3 | 34.68 | -0.09% | +0.84% | 34.71 | 34.96 | 34.35 | 7,979,100 |
| AZZA3 | 15.89 | -2.63% | -53.76% | 16.32 | 16.42 | 15.82 | 1,330,300 |
| CSNA3 | 4.30 | +0.47% | -42.65% | 4.28 | 4.41 | 4.26 | 10,076,100 |
| GGBR4 | 24.69 | +2.19% | +51.38% | 24.16 | 24.85 | 24.18 | 7,047,600 |
| ENEV3 | 24.21 | -1.38% | +70.49% | 24.55 | 24.64 | 23.99 | 9,297,000 |
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