May’s Food and Transport Help Lower Inflation: Daily

For second month in a row, food and air travel prices help slow inflation rates in May.

By Lise Alves, Contributing Reporter

SÃO PAULO, BRAZIL – Inflation cooled in May due mainly to food and transport prices, according to the IBGE (Brazilian Statistics Bureau). The IPCA (Consumer Price Index) registered an increase of 0.46 percent, the lowest rate since September of 2013. In April the IPCA index registered an increase of 0.67 percent.

Supermarket in Brazil, Rio de Janeiro, Brazil, Brazil News

Food prices helped lower IPCA index in April, photo by Nate Cull, Flickr Creative Commons License.

The food and beverages segment registered a decrease in inflation rate from 1.19 percent in April to 0.58 percent in May. However after decreasing by 1.94 percent in April, the tomato, considered by many a villain in 2013, once again surged in May. The price of the fruit increased by 10.52 percent last month.

“Food prices influenced the behavior of the IPCA and some items even registered lower prices in May, like potatoes,” said IBGE ‘s price index coordinator, Eulina Nunes dos Santos. Nonetheless, according to Santos the prices of food and beverages have increased more five percent this year.

In the transport group, air transportation continued to influence the decline of inflation for the segment going from 0.32 percent in April to -0.45 percent in May. According to the IBGE airline ticket prices fell by 21.11 percent. Gasoline and ethanol prices also declined by -0.35 percent and 2.34 percent respectively.

The accumulated IPCA rate from January to May was of 3.33 percent. Inflation accumulated in the last twelve months ending in May is at 6.37 percent, slightly below the 6.5 percent maximum annual inflation rate target established by Brazil’s Central Bank.

Read more (in Portuguese).

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4 Responses to "May’s Food and Transport Help Lower Inflation: Daily"

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