Inflation slows in July for low-income families, but rises for other classes
In July, the inflation rate was 0.8% for high-income families, compared to 0.04% in June. Among low-income and very low-income families, the rates were 0.18% and 0.09% last month, respectively — a decrease compared to 0.29% in June.
The Ipea survey also shows that very low-income families continue to have the lowest accumulated inflation rate in 12 months (4.05%), while for those with high incomes, the rate is the highest in the period (5.09%).
The president of the Union of Economists in the State of São Paulo (SINDECON-SP) Carlos Eduardo Oliveira Junior explains the difference in inflation indicators between social classes in the country.
“The slowdown in inflation for lower-income families in July can be explained by a combination of factors. Essential consumer items experienced a reduction in price and stability, which has a more direct impact on these families. On the other hand, the increase in inflation for higher-income classes may be related to the increase in the price of goods and services that have a greater impact on consumption patterns, such as higher value-added products and services, education, and travel.”
The main price drops were observed in the food and beverage group, such as cereals (-0.77%), tubers (-16.3%), fruits (-2.8%), poultry and eggs (-0.65%) and milk and dairy products (-0.41%). These reductions caused strong inflationary relief, mainly for families with lower purchasing power who spend most of their budget on purchasing these goods.
The increase in the price of electricity bills (1.9%), due to the adoption of the yellow tariff flag, and bottled gas (1.2%) explain the contribution of the housing group to the inflationary increase in July, especially for lower-income families.
High-income families, in turn, were hit hardest by the 3.3% price increases in fuel, 4.4% in vehicle insurance and 19.4% in airfare. The increase in the price of personal services (0.55%) and leisure (0.52%) also contributed to inflationary pressure for people with greater purchasing power.
Compared to July 2023, Ipea reveals an increase in inflation for all income brackets, with a more intense impact among very low-income families. In the same period last year, this income profile registered a deflation of 0.28%, compared to inflation of 0.09% this year.
To check the details of the Ipea Inflation Indicator by Income Range, access the link.
By Brasil 61
