The Extended National Consumer Price Index 15 (IPCA-15) changed by 0.02% in June, after having recorded -0.59% in May. It is the lowest result for a month of June since 2006, when the rate was -0.15%. IPCA-E, which is the cumulative rate in the quarter, stayed at -0.58%, below the 1.13% of the same period in 2019 and lower than the indicator for September 1998, when the rate was 0.92%.Cumulative IPCA-15 in the year was 0.37%  and, in 12 months, 1.92%, a figure below the 1.96% registered in the 12 previous months. In June 2019, the rate was 0.06%.

Among the nine groups of products and services surveyed, five recorded deflation in May. Transportationan recorded a lower change (-0.71%) and accounted for the main negative impact on the monthly index, with -0.14 percentage points (p.p.). In terms of  increasesas, the highlight was Food products (0.47%), which recorded a change that is close to the result of May (0.46%) and an impact of 0.09 p.p. The biggest change in the monthly was that of Household articles (1.36%), accounting for an impact of 0.05 p.p. The other groups ranged between a decrease of 0.15% in Wearing apparel and the hike of 0.66% in Communication.

The drop of 0.71% in Transportation was influenced, especially, by the airfares (-26.08%) result, which represented the main negative individual impact on the June IPCA-15 (-0.12 p.p.). All the surveyed areas showed a decrease in prices, which went from -34.37% in Belém to -15.85% in Fortaleza. It should be noted that the methodology of the airfares subitem determines that the collection should be done, approximately, two months in advance, that is, the change observed in the month index reflects the prices that were collected in April for trips in June (compared with the prices collected in March for tips in May).

Fuel prices (-0.34% and -0.02 p.p.) fell for the fourth consecutive month. Gasoline showed a decrease of 0.17%, after a change of -8.51% in the May index. In addition, diesel (-4.39%) and ethanol (-0.49%) also recorded decrease in prices. On the other hand, vehicle gas, which had dropped 1.21% in May, showed an increase of 0.84% in June IPCA-15.

Also in Transportation, vehicle insurance reported a drop of 2.27% and contributed with -0.02 p.p. to the monthly index. Moreover, the negative change in the cabs (-0.38%) subitem is due to the result of Rio de Janeiro (-1.69%), where  on May 22^nd, there was a cancellation of the adjustment occurred in January this year. It is worth mentioning the 0.35% change in the subway subitem, reflecting the adjustment of 8.69% in the fare prices in Rio de Janeiro (1.30%) as of June 11^th.  

In the Housing group (-0.07%), the main negative contribution (-0.02 p.p.) came from electricity (-0.48%). It worth remembering that, on May 26^th, the Brazilian Electricity Regulatory Agency (Aneel) announced that it will maintain the green tariff flag, without any additional charge in the electricity bills until the end of the year. The areas ranged between -2.30% in Porto Alegre and 0.32% in Salvador. Piped gas (-0.50%) reflects the reduction of 2.60% in the fares of Rio de Janeiro (-1.41%), in effect since May 1^st, and of 2.00% in the fares of São Paulo (-0.14%) since May 31^st. Finally, stand out the positive change in the water and sewage fees (0.11%) stand out, due to the average adjustment of 5.34% that occurred in Brasília (2.50%) on June 1^st.

Food and beverages (0.47%) was the group with biggest positive impact on the June IPCA-15. This high was especially influenced by food at home, which increased 0.56% in June. Potato registered an increase of 16.84% and 0.04 p.p. of impact. Other products that stood out were meat (1.08%), onion (14.05%) and pinto beans (9.38%), On the other hand, the prices of tomato (-12.36%), carrot (-12.05%) and fruits (-0.80%) worsened the fall in relation to the previous month (-3.40%, -6.41% and -0.46%, respectively).

Food away from home increased from May (0.13%) to June (0.26%), mainly due to snacks (0.82%) , whose prices had risen 0.64% in the previous month.

The biggest positive change in the monthly index came from the group of Household articles (1.36%), which had already showed an increase of 0.45% in the IPCA-15 of May. TV, sound and computer equipment, which had already increased 2.81% in May, reported a rise of 5.29% and contributed with 0.04 p.p to this month’s index. Following the same pattern, household appliances and equipment showed an increase from 0.89% in May to 3.36% in June. In contrast, furniture contributed the drop of prices (from -1.82% in May to -2.32% in June) and accounted for -0.02 p.p. of impact.

Regarding the regional index, four of the eleven surveyed regions reported deflection in June, according with the table below. Rio de Janeiro (0.27%) recorded the biggest figure, especially due to the increase in food, such as meat (4.35%) and potato (24.71%). The lowest result was registered in Belém (-0.20%), influenced by the drop in the price of airfares (-34.37%).

In order to estimate the IPCA-15, prices were collected from May 15 to June 15, 2020 (reference) and compared with those in effect from April 15 to May, 14, 2020 (base). The indicator refers to households 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.