IGP-DI rises 1.60% in June 2020

As a result, the indicator has gone up 4.54% so far this year and 7.84% in the last 12 months. In June 2019, it rose 0.63% and its 12-month increase was 6.04%.
Economics
09 July 2020
IGP-DI rises 1.60% in June 2020

The General Price Index – Internal Availability (IGP-DI) rose 1.60% in June, more than in the previous month, when it increased 1.07%. As a result, the indicator has gone up 4.54% so far this year and 7.84% in the last 12 months. In June 2019, it rose 0.63% and its 12-month increase was 6.04%.

“IGP-DI went up 2.74% in the second quarter. Among its component indexes, the main highlight was the Broad Producer Price Index (IPA), which increased 4.14% in the same period. The most notable items here were Iron Ore (26.09%), Soybeans (17.79%) and Beef (7.86%),” says André Braz, FGV’s price index coordinator.

IPA went up 2.22% in June, after increasing 1.77% in May. Breaking down the results by processing stage, the Finished Goods group went from 1.24% in May to 1.78% in June. The main driver for this increase was the Fuels for Consumption subgroup, whose rate accelerated from 5.89% to 20.61%. The Finished Goods (ex) index, which strips out fresh foods and fuels for consumption, rose 1.31% in June, compared to 0.90% in May.

The Intermediate Goods group’s rate went from -0.09% in May to 2.75% in June. The main driver for this movement was the Fuels and Lubricants for Production subgroup, whose rate went from -6.48% to 12.11%. The Intermediate Goods (ex) index, calculated after excluding fuels and lubricants for production, rose 1.71% in June, compared to 0.68% in the previous month.

The Raw Materials processing stage increased 2.16% in June, down from 4.15% in May. The following items contributed to the decline in the group’s rate: Iron Ore (12.32% to 3.93%), soybeans (8.59% to 1.21%) and coffee beans (-1.05% to -13.27%). Conversely, it is worth mentioning Beef (-0.18% to 5.69%), Fresh Milk (-2.26% to 5.36%) and Corn (-6.40% to -3.68%).

The Consumer Price Index (IPC) increased 0.36% in June, after decreasing 0.54% in May. Seven of the index’s eight spending classes saw an increase in their rate of change: Transport (-2.06% to 1.05%), Education, Literature and Recreation (-2.12% to -0.40%), Communication (0.01% to 0.88%), Food (0.37% to 0.57%), Housing (-0.19% to 0.00%), Clothing (-0.23% to 0.08%) and Miscellaneous Expenses (0.10% to 0.19%). In these spending categories, it is worth mentioning the behavior of these items: Gasoline (-7.08% to 3.28%), Airfares (-14.08% to 1.37%), Phone, Internet and Pay TV Packages (0.00% to 2.00%), Beef (0.09% to 2.59%), Household Appliances (0.06% to 2.02%), Footwear (-0.97% to -0.41%) and Banking Services (0.12% to 0.21%).

On the other hand, only the Health and Personal Care group (0.21% to 0.18%) showed a decrease in its rate of change. This spending class was influenced by the Hygiene and Personal Care Products item, whose rate went from 0.06% to -0.72%.

The core IPC rate went up 0.19% in June, compared to 0.11% the previous month. Of IPC’s 85 component items, 41 were excluded to calculate this core number. Eighteen of them recorded rates below -0.04%, the lower cut-off point, while 23 recorded variations of more than 0.64%, the upper cut-off point. In June, the diffusion index, which measures the proportion of items with a positive rate of change, was 60.65%, up 12.91 percentage points from 47.74% in May.

The Civil Construction Index (INCC) varied 0.34% in June, compared to 0.20% in May. INCC’s three component groups recorded the following variations between May and June: Materials and Equipment (0.55% to 0.87%), Services (0.02% to 0.23%) and Manpower (no variation, for the third consecutive month).

The complete study is available here.