The Extended Consumer Price Index (IPCA), Brazil's official inflation index, fell 0.32% in August, according to data from IBGE released this Friday. It was the first monthly deflation since August of last year, when the IPCA had dropped 0.11%. For the month of August, this was the smallest variation since 2022, when the index fell 0.36%. In July, the IPCA had recorded a slight rise of 0.07%.
The August result was driven mainly by the drop in residential electricity tariffs, which fell 7.63%, and by the Food and beverages group, which decreased 0.34%. Among the major price groups, Housing (-1.87%), Transportation (-0.86%), and Communication (-0.09%) also declined.
Over 12 months, the IPCA rose 4.22%, remaining below the upper limit of the continuous target pursued by the Central Bank, which is 3%, with a tolerance margin of 1.5 percentage points up or down. Year-to-date, the index has accumulated a rise of 3.11%.
