Brazil IGP-M drops in 1st preliminary results for July

The General Market Price Index (IGP-M), calculated by FGV’s Brazilian Institute of Economics (IBRE), went up 0.41% in the first ten-day period of July, recording a lower rate than in June, when the index had gone up 1.50%.

The Broad Producer Price Index (IPA) varied 0.34% in the first ten-day period of July. In the same period in June, the index had varied 2.06%. In the analysis based on processing stages, the prices of Finished Goods varied 0.59% in July, on average, after rising 1.98% in June. The fresh foods subgroup was one of the drivers behind this result, dropping from 9.70% to -8.60%. Intermediate Goods varied 2.22%, compared to 2.76% in the previous month. The supplies subgroup was the main factor behind such decrease, dropping from 5.46% to 1.73%.

The index for Gross Raw Materials fell 2.29%, after rising 1.31% in the previous month. The following items contributed to the group’s drop: sugar cane (-0.20% to -10.30%), corn (grain) (4.11% to -8.01%) and soy (beans) (0.93% to -3.53%). In the opposite direction, some of the highlights were cattle products (-0.61% to 0.46%), crushed stone (-0.01% to 8.60%) and pork products (0.38% to 4.54%).

The Consumer Price Index (CPI) varied 0.39% in the first ten-day period of July, compared to 0.54% in the previous month. Four of the eight expense categories that comprise the index recorded lower price variations, particularly the Food group (0.61% to -0.14%). The highlight in this expense category was the herbs and vegetables item, which varied from 10.85% to -17.43%.

The Clothing (1.43% to -0.94%), Transport (1.16% to 0.72%) and Health and Personal Care (0.54% to 0.25%) groups also recorded decreasing variation rates. The main drivers in this category were clothing (1.47% para -0.80%), gasoline (4.89% para 0.59%), and hygiene and personal care items (0.11% para -1.30%).

On the other hand, the Housing (0.34% to 0,98%), Education, Reading and Recreation (-0.41% to 0.74%), Communication (0.00% to 0.22%), and Miscellaneous Expenses (0.04% to 0.27%) groups recorded increasing variation rates. The following items stood out in these expense classes: household power bill (1.35% to 3.37%), airfare (-3.43% to 20.30%), mobile phone bill (0.00% to 0.43%), and religious and funeral service (0.20% to 1.56%).

The Civil Construction Index (INCC) rose 0.91% in the first ten days of July. This index rose 0.18% in the previous month. Prices for Materials, Equipment and Services rose 0.64%, compared to 0.25% in the previous month. The Manpower cost index varied 1.14%. In the previous month, this index varied 0.13%.

The complete study is available on the website.