With energy prices dropping, inflation is lowest for October since 1998

Section: Economic Statistics | Cristiane Crelier

November 07, 2019 09h00 AM | Last Updated: November 07, 2019 12h13 PM

The reduction in the price of electricity bills pressed the October´s IPCA downward - Photo: Licia Rubinstein/IBGE News Agency

The inflation in Brazil registered the lowest index for October since 1998. The prices rose 0.10% over September, when they deflated by 0.04%. The rate was 0.45% in October last year.

The data are from the Extended National Consumer Price Index - IPCA, released today by the IBGE. The cumulative index in the year stayed at 2.60% and, in the last 12 months, the inflation stayed at 2.54%.

The drop of 3.22% in the prices of energy was the major item that pressed the rate downward, impacting -0.13 percentage points on the IPCA. Except for Salvador, which posted a rise of 0.86%, and Vitória, of 2.24%, all the areas surveyed registered a decline in the prices of energy, which hit -5.99% in Goiânia.

"The red tariff flag level 1 was in force in September and, in October, the yellow one came into force, retreating the increase. In addition, one of the concessionaires in São Paulo reduced the residential fare, in force since October 23, as well as in Brasília and Goiânia, from October 22 onwards", clarified Pedro Kislanov, manager of the IPCA.

 Food at home remained dropping for the sixth month in a row. The reduction in the prices of onions (-20.84%) and potatoes (-9.06%) stood out. Having risen 1.77%, meat pressed the wallets of the Brazilian households.

On the other hand, wearing apparel recorded the highest inflation in October: 0.63%. Yet, women’s (0.98%), men´s (0.38%) and children´s wearing apparel (0.30%) become more expensive in this period. "The price of wearing apparel used to rise in this period due to the changing season, which results in changes in the apparel collections in the stores", explained Kislanov.

Transportation also rose its prices, impacted by the rise in gasoline, which substantially impacts the index. All the areas surveyed posted a positive change in the price of fuel, except Brasília and São Luís, which registered drops.

And for those who are beginning to plan their vacations, the bad news is that airfare increased (1.93%) after two months of negative changes.

Six areas surveyed deflated

Concerning the regional indexes, six areas surveyed record a deflation over September, being the biggest deceleration registered in the municipality of São Luís (-0.37%). Conversely, the highest positive change was in the municipality of Campo Grande (0.31%).

Both in the cumulative index in the year and over the last 12 months, Fortaleza was the municipality with the highest inflation (3.45% in both periods). São Luís reported the lowest cumulative index in the year (1.69%) and Curitiba, that of the last 12 months (1.55%).

Keywords: Inflação, Preços, Energia, Outubro.