The Extended National Consumer Price Index – IPCA changed 0.43% in March, less than half the rate of 0.90% registered in February. It was the lowest rate in March since 2012, when the IPCA recorded 0.21%. Considering the first quarter of the year, the index stayed at 2.62%, below the percentage of 3.83% posted in the same period in 2015.  In the last 12 months, the rate declined to 9.39%, below the rate of 10.36% relative to the 12 previous months. In March 2015, the IPCA stood at 1.32%, the highest rate since February 2003 (1.57%). The complete publication of the IPCA can be found here.

Food and Beverages, weighting 25.52% and representing the biggest chunk in the budget of the households, this group changed 1.24%. Exerting an impact of 0.32 p.p. and accounting for 74% of the index, this group overruled the March´s IPCA. The results of all the groups of products and services surveyed are shown in the following table:

The highest change in the Food and Beverages group (1.24%) was registered in the metropolitan area of Porto Alegre, where the rise hit 2.15%. Concerning the items surveyed, food products acquired to be consumed at home increased 1.61%, whereas those away from home stayed at 0.55%.

Having risen 8.91%, the 'fruits' item alone exerted the major impact in March: 0.10 p.p.. Among others, carrots (14.52%), acai berries (13.64%), garlic (5.70%), milk (4.57%) and carioca beans (4.10%) recorded significant increases.  The main items on the rise can be found in the table below.

On the dropping side, tomatoes stood out, as it was 7.43% cheaper.

Altogether, the other eight groups exerted an impact of 0.11 p.p., accounting for only 26% of March´s index. The main items on the rise in these groups were:

• TV, sound and computers  2.08%
• Ethanol  2.07%
• Motorcycle 1.94%
• Cleaning products  1.74%
• Cigarettes  1.48%
• Hairdresser 1.29%
• Personal hygiene products 1.25%
• Women’s wearing apparel 1.19%
• Health insurance 1.06%
• Household appliances 1.03%
• Car licensing 0.76%
• Domestic workers 0.72%
• Footwear 0.72%
• Manpower for small repairs 0.64%
• Regular courses 0.62%
• Gasoline 0.59%
• Condominium fees  0.58%
• Car repair 0.51%

Having risen 1.48%, cigarettes reflected price adjustments and reductions in particular brands and areas along February and March, according to the following:

• February 1 – average adjustment of 15% in the prices of particular brands in the areas of Belo Horizonte, Recife, Brasília, Fortaleza, Salvador, Curitiba and Goiânia;
• February 16 – average adjustment of 15% in São Paulo and Campo Grande;
• February 21 – adjustments between 3% and 17% in some brands in São Paulo, Rio de Janeiro and Curitiba, coupled with reductions between 4% and 7% in brands in other areas surveyed;
• February 29 – reduction of 6% in a brand marketed in São Paulo;
• March 7 – average reduction of 6% in the prices of brands marketed in São Paulo and Rio de Janeiro;
• March 14 – average reduction of 4% in particular brands in Porto Alegre, Brasília, Goiânia and Campo Grande;
• March 28 – adjustment of 3% in brands in Curitiba.

In opposition to the highs, important items either dropped or reduced the growth rate of prices from one month to the other. The main item was electricity, whose drop of 3.41% triggered the most significant impact downward: -0.13 p.p.. This was due to the reduction of the extra fare since March 1st, which changed from R$3.00 (red flag) to R$1.50 (yellow flag) per 100 kilowatt-hour. The bills became cheaper in all the areas surveyed, also due to the reduction of PIS/COFINS in most of them. The metropolitan area of Salvador stood out with bills 8.55% cheaper.

Other items stood out in terms of price drop:

• Bottled gas -0.42%
• Water and sewage fees -0.43%
• Excursion -2.49%
• Mobile telephone -2.71%
• Landline telephone -2.89%
• Airfare -10.85%

 The change of -0.43% in water and sewage fees was influenced by the metropolitan area of São Paulo. It contributed with -2.99% to this item, due to the application of a 0.78 factor to the average consumption of water to compute the bonus granted by the Incentive Program for Reduction of Water Consumption. The application of the 0.78% factor was authorized by ARSEP resolution no. 615, of December 23, 2015.

On the other hand, the item water and sewage fees rose 3.92% in the metropolitan area of Recife, as a result of the adjustment of 10.69% in force since March 20. In Porto Alegre, the change of 0.46% was due to the residual adjustment of 10.54% in force since February 1.

In the case of telephony, the drop of 2.71% in mobile telephone was due to the reduction of the fare of a particular carrier, whereas landline telephone changed -2.89%, as a result of the reduction of 22% in the calls from landline to mobile.

The group of Education changed from 5.90% to 0.63% between February and March, leaving behind the adjustments in the month tuitions that took place this year.

Having posted 0.72%, the highest regional index was in the metropolitan area of Fortaleza, pressed by the rise of 6.93% in the regular courses, which are adjusted at a different date compared with other areas. Having registered -0.14%, the lowest index was in the metropolitan area of Salvador, mainly due to the drop of 8.55% in the electricity item, as well as to the price of the liter of gasoline, which became 2.41% cheaper. See below the table of monthly results by area surveyed.

In order to measure the index of the month the prices collected from March 1 to March 30, 2016 (reference) were compared with the ones in force from January 29 to February 29, 2016 (base). IPCA has been calculated by IBGE since 1980. It refers to families with monthly income of one to 40 minimum wages, whatever the source. It encompasses ten metropolitan areas in the country, besides the municipalities of Goiânia, Campo Grande and Brasília.

INPC stays at 0.44% in March

The National Consumer Price Index – INPC changed 0.44% in March and stood 0.51 p.p. below the result of 0.95% in February. Since the rate of 0.18% in 2012, the INPC had never recorded any lower figure in March. Considering the first quarter of the year, the index stayed at 2.93%, below the percentage of 4.21% posted in the same period in 2015.  In the last 12 months, the rate declined to 9.91%, below the rate of 11.08%% relative to the 12 previous months.  In March 2015, the INPC was at 1.51%.

Food products increased 1.12% in March, while the rise was 1.19% in February. The group of non-food products changed 0.14% in March, well below the rate of 0.84% in February.

The highest regional index was registered in the metropolitan area of São Paulo (0.68%), due to the rise of 5.61% in the item cigarettes. It reflected the average adjustment of 15% applied to particular brands between February 16 and 21, despite the reduction of 6% in the price of a particular product on February 29, as well as another reduction of 6% in the price of another product on March 7. Having registered -0.07%, the lowest index was in the metropolitan area of Salvador, mainly due to the drop of
 8.53% in the electricity item, as well as to the price of the liter of gasoline, which became 2.41% cheaper. See below the table of monthly results by area surveyed.

In order to measure the index of the month the prices collected from March 1 to March 30, 2016 (reference) were compared with the ones in force from January 29 to February 29, 2016 (base). The INPC has been calculated by IBGE since 1979. It refers to families with monthly earnings between one and five minimum wages, with a salaried head of the family, and it encompasses ten metropolitan areas in Brazil, as well as the municipalities of Goiânia, Campo Grande and Brasília.