Itaú BBA - IPCA-15 rises 0.02% in June and 1.92% yoy

Macro Brazil

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IPCA-15 rises 0.02% in June and 1.92% yoy

junio 25, 2020

IPCA-15 close to zero in June. Core inflation measures below expectations.


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• The mid-month consumer price index IPCA-15 rose slightly by 0.02% in June, printing above our estimate (-0.09%) and the median of market expectations (-0.05%). Food consumed at home and auto fuels were behind the main surprises compared to our forecast. Some industrial goods — such as phones, household appliances, TV, audio, and information technology — also put pressure on today's result.

• Core inflation measures remain low and are slowing down at the margin. Underlying services stood out with 0.02% deflation during the month, while the year-over-year increase slid to 2.7% from 2.8%. 

• The next readings for the headline IPCA will likely sustain the benign dynamics, with the pressure concentrated on regulated prices. We estimate increases of 0.24% in June, 0.41% in July, and 0.19% in August. We expect the IPCA to advance 1.8% in 2020 and 2.8% in 2021.
 

Julia Passabom


For the version with all charts and tables, please open the attached pdf file



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