Itaú BBA - IPCA climbs 0.57% in April and year-over-year change peaks at 4.94%

Macro Brazil

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IPCA climbs 0.57% in April and year-over-year change peaks at 4.94%

mayo 10, 2019

Headline inflation accelerated on an annual basis pressured by food and fuels; but should begin a downward path from now on

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

 The consumer price index IPCA climbed 0.57% in April, printing somewhat below our estimate (0.63%) and the median of market expectations (0.62%). Food items consumed at home were behind the surprise, particularly beef, fruits and tubercles. We revised our preliminary estimate for the IPCA in May to 0.29% and expect increases of 0.44% in June and 0.11% in July.

 Incorporating the latest report, the IPCA is up 4.94% yoy. Considering our estimates for the coming months, the year-over-year change probably peaked in April. In June 2019, when the 1.26% hike posted in June 2018 (deeply impacted by the truckers' stoppages in the previous month) slips out of the calculations, inflation should stay near 4.0%.
 

Julia P. Araujo
 

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



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