Brazil witnessed a decrease in prices in August, influenced by reductions in food and housing expenses. The Brazilian Institute of Geography and Statistics (IBGE) reported a 0.02% decline in prices, defying the anticipated 0.02% increase by economists. This event marked August as the initial month since June 2023 to register a downturn, with the IPCA, Brazil's principal price index, escalating by 4.24% over the past year. This progression aligns with the government's 2024 inflation ceiling of 4.5%.
According to the IBGE, the food and beverage sector saw a 0.44% reduction in prices last month. This sector alone accounted for a 0.09% decrease in the overall IPCA, suggesting that without the upticks in other categories, inflation rates would have been even lower. Notably, prices for food items consumed at home fell by 0.73%, led by substantial price drops in potatoes (-19.04%), tomatoes (-16.89%), and onions (-16.85%), while papaya and bananas experienced price increases of 17.58% and 11.37%, respectively.
The preceding month, July, had an IPCA increment of 0.38%, pushing the 12-month cumulative index to the 2024 target's threshold of 4.50%.
Source: Brasil de Fato