By Lise Alves, Senior Contributing Reporter
SÃO PAULO, BRAZIL – Brazil’s IPCA (Consumer Price Index) for the month of December 2014 registered a variation of 0.78 percent, according to data released by the IBGE (Brazilian Statistics Institute) on Friday, January 9th. The rate was above the increase registered in November 2014, which was of 0.51 percent, but lower than in December 2013 with a rate of 0.92 percent. With the result for the last month of 2014, the IPCA index for last year closes at 6.41 percent, the highest rate since 2011.
However, even though last year’s rate surpassed the 2013 rate of 5.91 percent, it remains lower than the Central Bank’s inflation target ceiling of 6.5 percent.
The main culprits for December’s inflation increase were transportation, especially air travel, and food. Air travel increased by 42.53 percent during the month and led the Transportation Sector index to register an increase of 1.38 percent, affecting inflation by 0.20 percentage points.
In the food segment, meat prices increased by 3.73 percent and caused a 0.10 percentage point increase in the index. Together with air travel the two items were responsible for almost half of the IPCA increase in December (47 percent).
Among the other items, which increased the most in December, in comparison to November, were transport (from 0.43 percent to 1.38 percent), food (from 0.77 percent to 1.08 percent), clothing (from 0.39 percent to 0.85 percent), and personal expenses (from 0.48 percent to 0.70 percent).
Among the regions with the highest increase in inflation is the Rio de Janeiro Metropolitan area, which registered an additional 1.39 percent due to the increase in electricity bills.