The General Price Index – Market (IGP-M) fell 0.32% in the first 10 days of May 2020, according to the FGV´s Brazilian Institute of Economics (FGV IBRE). In the first 10 days of April, this index rose 1.05%.

“The decline in the food group in the Broad Producer Price Index (IPA), which went from 1.86% to -0.24%, will sustain the continued deceleration of food prices in the Consumer Price Index (IPC), which varied 0.44% so far in May, compared to 1.24% in April. These movements, combined with the decline in fuel prices observed in IPA and IPC, had a major impact on IGP-M in the first 10 days of May,” said André Braz, FGV IBRE’s price index coordinator.

The Broad Producer Price Index (IPA) fell 0.35% in the first 10 days of May. In the same period of April, the index went up 1.43%. Breaking down the results by processing stage, the prices of Finished Goods went from -0.04% in April to -0.41% in May. The main contribution came from the Fresh Food subgroup, whose rate dropped from 6.77% to -0.53%. The result for Intermediate Goods went from 1.72% in the first 10 days of April to -1.35% in the same period of May. This decline was influenced by the Manufacturing Materials and Components subgroup, which went from 3.61% to 0.00%.

Over the same period, the figure for Raw Materials fell from 2.66% to 0.69%. The following items in the group helped bring down the number: Corn (2.99% to -6.77%), Soybeans (6.77% to 3.30%) and Oranges (8.76% to -9.45%). On the other hand, Beef rose from -3.95% to 0.31%, Poultry increased from -2.74% to -2.35%) and Wheat went up from 5.87% to 6.67%.

The Consumer Price Index (IPC) fell 0.46% in the first 10 days of May, after rising 0.33% one month before. There were declines in seven of the index’s eight component spending classes, most notably Transport (-0.67% to -2.41%). In this category, there was a notable contribution from the Gasoline item, which dropped from -2.65% to -7.98%.

The following groups also saw declines in their rates of variation: Education, Literature and Recreation (0.49% to -1.50%), Food (1.24% to 0.44%), Housing (0.38% to 0.03%), Health and Personal Care (0.46% to 0.25%), Clothing (-0.07% to -0.39%) and Communication (0.05% to 0.00%). In these spending classes, the biggest influences came from the following items: Airline Tickets (6.82% to -15.08%), Vegetables (9.31% to 2.84%), Residential Water and Sewage Charges (1.47% to 0.00%), Hygiene and Personal Care Products (0.94% to 0.35%), Men’s Clothes (-0.50% to -1.60%), and Residential Phone Charges (0.30% to 0.03%).

The only increase in variation rate occurred in the Miscellaneous Expenses group (0.43% to 0.54%). In this spending class, there was a notable result for the Banking Services item (0.41% to 0.82%).

The Civil Construction Index (INCC) increased 0.18% in the first 10 days of May, up from 0.16% in the first 10 days of April. Over the same period, INCC’s three components recorded the following rates of change: Materials and Equipment (0.41% to 0.52%), Services (0.17% to -0.07%), and Labor (which did not vary for the second month in a row). 

The complete study is available here.