Itaú BBA - IPCA rises 0.40% in May, above expectations

Macro Brazil

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IPCA rises 0.40% in May, above expectations

junio 8, 2018

Our preliminary estimate for the IPCA in June is an increase of about 1%

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

The consumer price index IPCA climbed 0.40% in May, topping our estimate (0.30%) and the median of market expectations (0.29%). The deviation vs. our call was concentrated on fuels and food items, likely reflecting the impact of the truckers’ stoppage. The index had risen 0.22% in the previous month and 0.31% in May 2017. The year-to-date increase of 1.33% is the lowest since the Real Plan was implemented. The year-over-year change accelerated to 2.86% from 2.76% in April.  Housing (0.13 p.p.), food and beverages (0.08 p.p.), transportation (0,07 p.p.), and healthcare and personal care (0.07 p.p.) provided the largest upward contributions during the month. Our preliminary estimate for the IPCA in June is an increase of about 1%, with the year-over-year rate picking up to 4.1%. The biggest contributions during the month will come from electricity, food and fuel costs, with the last two items still reflecting the protest. For 2018, we forecast a 3.8% advance in the IPCA.

Elson Teles
Economist

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



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