Inflation preview

IPCA-15 drops 0.59% in May, highest deflation since the beginning of Real Plan

Section: Economic Statistics | Umberlândia Cabral

May 26, 2020 09h00 AM | Last Updated: May 26, 2020 12h03 PM

Drop in fule prices pressed the IPCA-15 downward in May - Photo: Helena Pontes/IBGE News Agency

Influenced by the drop in fuel prices, the early inflation of May registered -0.59%, the most intense deflation since the beginning of the Real Plan, in July 1994. Having fallen 8.51%, gasoline was the item that recorded the highest negative individual impact, contributing with -0.41 percentage points to the Extended National Consumer Price Index 15 (IPCA-15), released today (26) by the IBGE. This was the second consecutive deflation of the IPCA-15, which posted -0.01% in April.

The retraction of 8.54% in fuels was also influenced by the drop in the prices of ethanol (-10.40%), diesel fuel (-5.50%) and vehicular gas (-1.21%). Like fuels, airfare is part of the group of Transportation – which has the highest weight in the consumption of households – and dropped 27.08%, after rising 14.83% in April. This group registered the highest deflation this month.

The cumulative change over the year was 0.35% and, in the last 12 months, 1.96%, below the rate of 2.92% recorded in the 12 immediately previous months. In May 2019, the rate was 0.35%.


Having recorded 0.46% against 2.46% in the previous month, the group of Food and beverages decelerated. The major influence on the result of this group was food for consumption at home, which changed from 3.14% in April to 0.60% in May.

Onions was the food that increased the most (33.59%), followed by potatoes (16.91%) and carioca beans (13.62%). On the other hand, carrots, which had risen 31.67% in the last IPCA-15, fell 6.41%. Meat (-1.33%) stepped up the drop over the previous month (-0.27%). Food away from home, which includes delivery services (not considering delivery fees), also decelerated between April (0.94%) and May (0.13%), especially due to snacks (0.64%), whose prices had increased 3.23% in the previous month.

The second highest positive change in the month´s index came from the group of Household articles (0.45%), highlighted by the rises in the items TV, sound and computers (2.81%) and household appliances and equipment (0.89%). On the dropping side, the biggest negative contribution (-0.02 p.p.) came from furniture (-1.82%), though the drop in May has been less intense than that registered in April (-4.00%).

Having retreated 0.27%, the group of Housing contributed with -0.04 p.p. to the month´s index. The biggest influence in this drop came from electricity (-0.72). Other items of this group that dropped were bottled gas (-1.09%) and piped gas (-0.36%). Conversely, water and sewage fees changed 0.04%.

All the 11 areas surveyed recorded a deflation in May. The highest index was in the metropolitan area of Fortaleza (-0.23%), influenced by the rise in some food items, like onions (43.87%) and meat (2.94%). In contrast, the lowest result was in the metropolitan area of Curitiba (-1.12%), caused by the drop in the prices of fuels (-10.86%), especially gasoline (-10.35%), and airfare (-24.48%).

The prices were collected from April 15 to May 14, 2020 (reference) and compared with those in effect from March 17 to April 14, 2020 (base). Due to the Covid-19 pandemic, the IBGE suspended the face-to-face price collection on March 18. As of this date, prices began to be collected through other means, such as surveys on Internet sites, by phone or email.