Brazil Inflation Rate Drops with Decrease in Travel: Daily

The end of the World Cup decreased air travel and hotel costs, lowering inflation rate for July.

By Lise Alves, Senior Contributing Reporter

SÃO PAULO, BRAZIL – As expected, airline tariffs and hotel costs registered a downward trend after the end of the World Cup, leading to a decline in Brazil’s inflation rate for July, according to the IBGE (Brazilian Statistics Bureau). The IPCA (Consumer Price Index) registered a decline from 0.4 percent in June to 0.1 percent in July.

Santos Dumont airport, Brazil, Brazil News

The crowded airports seen in June gave way to half full terminals in July and affected inflation rates last month, photo by Tania Rego/Agencia Brasil.

“[In June] Air travel increased a great deal due to the World Cup, while in July the segment registered a retraction. The same thing was seen in hotel accommodations,” said Eulina Nunes dos Santos, IBGE coordinator for the index.

The main component responsible for the decline in last month’s inflation index, air travel, plunged by 26.86 percent in July after surging 21.95 percent in June. In the segment of personal expenditures, hotel accommodations registered a decline of 7.65 percent, after a steep rise by 25.33 percent in June.

The segment of food and beverages continued June’s downward trend in July, decreasing from 0.11 percent in June to 0.15 percent in July. According to Santos the supply of food around the world has been increasing. In Brazil, the forecast for the upcoming harvest is of a 2.4 percent increase from last year, totaling 192 million tons of grains.

With the decrease in the rate in July, inflation accumulated in the past twelve months fell from 6.52 percent to 6.5 percent, the ceiling of the government’s inflation target.

Read more (in Portuguese).

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One Response to "Brazil Inflation Rate Drops with Decrease in Travel: Daily"

  1. Pingback: Inflation Increases in August Due to Air Travel, Housing: Daily Update | The Rio Times | Brazil News

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