Itaú BBA - IPCA rose 0.33% in July, above the median of market expectations

Macro Brazil

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IPCA rose 0.33% in July, above the median of market expectations

agosto 8, 2018

Our preliminary estimate for the IPCA in August is a 0.03% move

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

The consumer price index IPCA rose 0.33% in July, printing above our estimate (0.25%) and the median of market expectations (0.26%). Inflation decelerated sharply from 1.26% in June, showing the waning impact of the cargo transportation stoppages (on food and fuel prices) and the red mode in the tariff flag system (on electricity bills). The food group posted milder-than-expected deflation and was behind the deviation vs. our call. Year-to-date, the IPCA went up 2.94% and the year-over-year change picked up to 4.48% from 4.39% in June. The biggest upward contribution during the month came from the housing group (0.24 p.p.), led again by electricity, followed by transportation (0.09 p.p.). Meanwhile, food and apparel posted negative contributions of -0.03 p.p. each. Our preliminary estimate for the IPCA in August is a 0.03% move, with the year-over-year rate slowing down to 4.32%.
 

Elson Teles
Economist


 

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



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