The Extended National Consumer Price Index 15 (IPCA-15) changed by -0.16% in December, whereas the November rate was 0.19%. That is the lowest figure since July 2017 and the lowest one for a month of December since the implementation of Real as the Brazilian currency, in 1994. As a result, IPCA-E, which is the cumumulative IPCA-15, closed 2018 at 3.86%, below the 4.39% registered in the previous 12 months. In December 2017, the rate was 0.35%.

Among the nine groups og products and services surveyed, four faced deflation from November to December: Transportation (-0.93%), Health and personal care (-0.58%), Housing (-0.52%) and Communication (-0.07%). In terms of rising figures, the highlight was Food and beverages (0.35%), which accounted for the biggest positive impact on the monthly index, with 0.08 percentage points (p.p.). The other groups changed between 0.02% of Education and 0.44% of Houseold articles.

The group Transportation recorded the biggest decrease (-0.93%) and the major impact (-0.18 p.p.) in the month of December, mainly due to the fall of gasoline (-5.47%). That fuel accounted for the main individual impact on the monthly index, with -0.26 percentage points. Prices fell in all the areas surveyed, and the index ranged between -8.90%, in Salvador, and -3.02%, in Fortaleza. Besides gasoline, ethanol and diesel also fell in December (-3.00% and -1.93%, respectively). Airfares rose 29.61%, being the main positive individual impact on the IPCA-15 of December (0.11 percentage points).

As for Health and personal care (-0.58%), the highlights were the prices of personal hygiene (-4.46%), mainly due to skincare products (-9.90%), perfumes (-7.13%) and make-up articles (-6.93%).

The result of Housing (-0.52%) was influenced by the fall of electricity (-3.61%), the second main impact on the monthly index (-0.14 percentage points). After the stop of the yellow tariff flag, which adds R$ 0.01 to each kwh consumed, the green tariff, without additional charge, started on December 1st. In Porto Alegre (-2.50%), the average price adjustment was 8.34% in the kw/hour in one of the concessionaires surveyed. It went into effect on November 22nd.

Also in the group Housing, the item bottled gas, which had recorded a decrease of 0.37% in the IPCA-15 of November, recorded a hike of 1.62%. The price adjustment of the 13 kg gas bottle (8.53%), in effect since November 6 in refineries, as previously announced by Petrobrás. The change in the rate of water and sewage (0.24%) refers to the rise of 6.04% in fares in Rio de Janeiro (2.42%), on December 1st. Piped gas (1.49%), rose 4.61%, also in Rio de Janeiro (2.84%), on November 1st.

The fall of 0.07% in Communication was mainly influenced by the decrease in telephone appliances (-1,89%). In the item mailing services (-1.15%), there was adjustment in postal services, starting on November 9, and halt of the R$ 3.00 charge for deliveries in Rio de Janeiro, starting on November 16.

O grupo Alimentação e bebidas, que havia subido 0,54% em novembro, desacelerou para 0,35% por conta da alimentação no domicílio, que registrou 0,22% em dezembro, após a alta de 0,85% do mês anterior. Esse resultado foi influenciado por uma queda mais acentuada nos preços do leite longa vida (de -3,74% em novembro para -10,39% em dezembro) e pelas quedas em itens como arroz (-0,84%), farinha de mandioca (-2,47%) e alho (-3,38%). Por outro lado, cebola (34,16%), batata-inglesa (17,80%), tomate (8,37%) e carnes (0,92%) seguem com preços em alta.

Food away from home, accelerated from November to December (from -0.01% to 0.58%), the main highlights being meals (0.67%) and snacks (0.57%). In the previous month, both had recorded decrease (-0.05% and -0.33%, respectively).

As for regional indexes, almost all the areas surveyed faced deflation in December. The exception was Belém (0.27%), the result of which was mainly due to the hikes in airfares (31.12%), tomato (27.06%) and assai (12.86%). The lowest index (-0.30%) was that of Brasília, with lower prices of gasoline (-8.75%) and of personal hygiene items (-5.08%).

In order to estimate IPCA-15, the prices collected from November 13 to December 12 (reference) were compared with the ones in force from October 12 to november 12, 2018 (base). The indicator refers to families with monthly income of 1 to 40 minimum wages and it encompasses the metropolitan areas of Rio de Janeiro, Porto Alegre, Belo Horizonte, Recife, São Paulo, Belém, Fortaleza, Salvador, Curitiba, as well as Brasília and Goiânia. The methodology is the same as the one used for the IPCA; the difference lies in the period of price collection and in the geographic coverage.