IGP-M drops 1.93% in June and accumulates drop in 12 months, says FGV

The General Price Index – Market (IGP-M), used in rent adjustments, fell 1.93% in June, after falling 1.84% in the previous month. With this result, the index fell by 4.46% in the year and 6.86% in 12 months. In June 2022, the index rose 0.59% and had accumulated a 10.70% increase in 12 months. The information was released this Thursday (29) by the Brazilian Institute of Economics of the Getulio Vargas Foundation (Ibre/FGV).

The Broad Producer Price Index (IPA) dropped 2.73% in June, compared to a drop of 2.72% in May. In the analysis by stages of processing, the rate of the Final Goods group fell 1.22% in June. In the previous month, the rate fell by 0.16%.

The main contribution to this result came from the fuels for consumption subgroup, whose rate changed from -1.27% to -10.56% in the same period. The index related to Finished Goods, which excludes food subgroups in nature and fuels for consumption, fell 0.39% in June, after falling 0.09% in the previous month.

The rate for the Intermediate Goods group dropped again, dropping from -1.49% in May to -2.88% in June. According to the FGV, the main reason for this movement was the subgroup fuels and lubricants for production, whose percentage changed from -6.09% to -11.44%. The Intermediate Goods index, obtained after excluding the subgroup fuels and lubricants for production, dropped 1.39% in June, against a drop of 0.64% in May.

The stage of raw materials fell 4.10% in June, after registering -6.48% in May. “The following items contributed to the softening of the drop in the group: iron ore (-13.26% to -2.21%), soy in grain (-9.40% to -4.32%) and corn in grain (-15.64% to -14.85%). On the other hand, the following items stand out: milk in nature (3.92% to -4.51%), beef (-3.34% to -6.55%) and coffee beans (-1.81% to -5.49%)”, says the FGV.

According to the coordinator of the Ibre/FGV Price Indices, André Braz, producer inflation registered a new deflation, now driven by the drop in fuel prices at the refinery.

“The price of diesel shrank by 13.82%, while the price of gasoline fell by 11.69%. Apart from this contribution, the prices of important commodities agriculture and livestock continue to fall, such as corn (-14.85%) and cattle (-6.55%). In terms of the consumer, an index that fell by 0.25%, the main contributions came from gasoline prices (-3%) and new cars (-3.76%)”, he said, in a note.

IPC and INCC

The Consumer Price Index (CPI) fell 0.25% in June. In May, the index changed by 0.48%. Seven of the eight expense classes that make up the index showed a decrease in their rates of change. The largest contribution came from the Transport group, whose rate of change changed from 0.50% to -1.68%. In this expense category, it is worth mentioning the behavior of gasoline, whose price varied -3.00%, compared to -0.09% in the previous edition.

The National Construction Cost Index (INCC) increased by 0.85% in June, compared to 0.40% in May. The three groups comprising the INCC recorded the following changes from May to June: materials and equipment (-0.06% to -0.15%), services (0.64% to 0.18%) and labor (0.75% to 1.81%).