The Extended National Consumer Price Index - IPCA stayed at 0.19% in July, 0.18 percentage points (p.p.) above the June´s figure (0.01%). This was the lowest IPCA for July since 2014, when it stayed at 0.01%. The cumulative change in the year stayed at 2.42% and, in relation to the last 12 months, the index retreated to 3.22%, below the rate of 3.37% registered in the 12 immediately previous months. In July 2018, the rate was 0.33%.

The July index was concentrated on the group of Housing, whose change of 1.20% corresponded to an impact of 0.19 p.p. Having changed 0.01%, the group of Food and beverages maintained their prices stable between June and July. On the other hand, the groups of Wearing apparel (-0.52%), Health and personal care (-0.20%) and Transportation (-0.17%) recorded a deflation this month.

The highlight in the group of Housing (1.20%) was electricity, whose fares became, on average, 4.48% more expensive for the consumers. The change of this item, whose impact was of 0.17 p.p., swung between the drop of 0.40% in Rio Branco and the rise of 7.59% in the metropolitan area of São Paulo.

Besides the incidence of the yellow tariff flag, which added R$1.50 per 100 kWh consumed, the following areas had their electricity fares adjusted: São Paulo (7.59%), adjustment of 7.03% in one of the concessionaires on July 4; Curitiba (3.18%), average adjustment of 3.41% in force since June 24 and Porto Alegre (3.36%), where two out of the three concessionaires of electricity merged and, to unify their fares, average adjustments of 3.61% and 6.19% were granted on June 19.

Still in the group of Housing, the change of 0.73% in the water and sewage fees should be highlighted, reflecting the following adjustments:

• Salvador (1.95%) – adjustment of 4.70%, from June 12 onwards;
• Goiânia (5.40%) – adjustment of 5.79%, from July 1st onwards;
• Porto Alegre (3.50%) – adjustment of 7.69% in the fare of one of the concessionaires, from July 1st onwards;
• Recife (3.67%) – adjustment of 6.00%, from July 13 onwards.

In Fortaleza (-3.66%), the adjustment previously granted in February was reduced from 15.86% to 4.31% on July 2. Nevertheless, the reduction was canceled on July 9 and the adjustment of 15.86% came into force again.

In the other groups that registered positive changes, such as Personal expenses (0.44%), the items excursion (4.43%) and domestic workers (0.24%) stood out. In Communication (0.57%), the highlight was mobile phone (1.46%), whose rise reflected the average adjustment of 10.00% of one of the carriers from July 6 onwards.

Accounting for nearly 1/4 of the household expenditures, the group of Food and beverages (0.01%) remained stable between June and July. On the one side, we had onions (20.70% and 0.03 p.p.), fruits (2.51% and 0.03 p.p.) and meat (1.10% and 0.03 p.p.). On the other side, tomatoes (-11.28% and -0.04 p.p.), carioca beans (-8.86% and
-0.02 p.p.), green vegetables (-4.98% and -0.01 p.p.) and potatoes (-3.68% and -0.01 p.p.).

On the side of the drops, the group of Wearing apparel (-0.52%) recorded the highest negative change among the groups, highlighted by women’s wearing apparel (-1.39%). After rising 0.64% in June, the group of Health and personal care (-0.20%) reflected the rebates in the item personal hygiene (-2.01%).

In the group of Transportation (-0.17%), the drop was leveraged by fuels
(-2.79%), highlighted by gasoline (-2.80% and -0.12 p.p.), which represented the biggest negative impact on the month´s index, whose areas varied between -6.89% in the metropolitan area of Salvador and 1.11% in the metropolitan area of Porto Alegre. After rising -5.08% In June, ethanol fell 3.13%. In diesel fuel, the drop was of 1.76% and, in natural gas, of 1.47%.

Still in Transportation, the item airfare changed 18.63% and impacted 0.08 p.p. The highlights were interstate bus, whose change of 5.21% on July 1st reflected the adjustment of 3.20% in the coefficient to compute the referential fare for each market, and urban bus (0.10%), whose change was due to the adjustment of 9.09% in the fare in Belém (1.70%), in force since June 5.

Concerning the regional indexes, the metropolitan area of Porto Alegre (0.54%) posted the highest change, due to the rises in fruits (5.72%) and in electricity (3.36%), in which two out of the three concessionaires of electricity merged and, to unify their fares, average adjustments of 3.61% and 6.19% were granted on June 19. The lowest index was registered in Goiânia (-0.22%), influenced by the drop in the prices of tomatoes (-20.28%) and gasoline (-4.20%).

The IPCA has been calculated by the IBGE since 1980. It refers to households with monthly income of 1 to 40 minimum wages, whatever the source. It encompasses ten metropolitan areas in Brazil, besides the municipalities of Goiânia, Campo Grande, Rio Branco, São Luís, Aracaju and Brasília. In order to estimate the index of the month, the prices collected from June 29 to July 29, 2019 (reference) were compared with the prices in force from May 30 to June 28, 2019 (base).

INPC changes 0.10% in July

The National Consumer Price Index - INPC changed 0.10% in July, 0.09 p.p. above the June´s rate (0.01%). This was the lowest figure for July since 2013, when it recorded -0.13%. The cumulative change in the year stayed at 2.55% and, in relation to the last 12 months, the index retreated to 3.16%, below the rate of 3.31% registered in the 12 immediately previous months. In July 2018, the rate was 0.25%.

Food products fell 0.05% in July and recorded -0.18% in the previous month. The group of non-food products changed 0.17%, whereas it recorded 0.09% in June.

Concerning the regional indexes, the metropolitan area of Porto Alegre (0.55%) posted the highest change, due to the rises in meat (2.88%) and in electricity (3.39%), in which two out of the three concessionaires of electricity merged and, to unify their fares, average adjustments of 3.61% and 6.19% were granted on June 19. The lowest index was registered in Rio Branco (-0.26%), influenced by the drop in the prices of the item personal hygiene (-1,44%) and gasoline (-3,34%).

The INPC has been calculated by the IBGE since 1979. It refers to households with monthly income of 1 to 5 minimum wages, with a salaried head of the household. It encompasses ten metropolitan areas in Brazil, besides the municipalities of Goiânia, Campo Grande, Rio Branco, São Luís, Aracaju and Brasília.