Producer Prices
With fourth increase in a row, inflation in industry rises 1.43% in May
July 03, 2019 09h00 AM | Last Updated: July 03, 2019 11h33 AM
Prices in industry rose 1.43% in May, against April, due to hikes in the sectors of food products, oil products and mining and quarrying. This is the fourth consecutive month of rise of industry prices. As a result, the cumulative index in the year has changed from 2.52%, in April, to 3.99%.
These data come from the Producer Price Index (IPP), released today by the IBGE. The survey measures the change in the prices of products at the "factory gate", without tax or freight, encompassing 24 activities from mining and manufacturing industry.
According to the survey analyst, Alexandre Brandão, despite the high rates, the index is at a lower level than last year. “That is partially due to the effect of exchange rates, which greatly affect exported products. For example, the depreciation of the Real currency versus the Dollar fell from 6.7%, in May last year to 2.7% this year", the anlayst highlights.
The change of prices by 1.75% in the food industry, in May, was the biggest since December 2018 (2.03%), due to rises in soybeans, poultry meat, sugar and beef. As a result, the cumulative index in the year increased from 0.33% up to April, to 2.09%, below the index of last year, when the cumulative figure was 5.39%.
According to Alexandre, the increase in that group resulted from the expansion of soybean exports, due to the crop failure in the USA, the excess of rain of rain and the increase of exports related to the Swine flu epidemic i China. “Also, the price index for those products is affected by the Real depreciation aganint the Dollar”, Alexandre explains.
In the sector of oil products, prices changed by 3.28%, with a highlight to gasoline and diesel, and the cumulative index in the year at 19.90%. The result of mining and quarrying industry (6.50%) was defined by iron ore and oil extraction. “In these cases, the rise is a consequence of the price variations in the international market", says the analyst.
Among the main economic categories, May recorded increases of 1.27% in capital goods, 1.81% in intermediate goods and 0.92% in consumer goods, being 0.14% in durable consumer goods and 1.08% in semi-durable and non-durable consumer goods.
