Brazil’s Broad Consumer Price Index (IPCA) rose to 0.59% in January, after having reached 0.36% in December. It was the highest index since October 2005.
The data were just released, this Thursday, February 9, by the Brazilian Institute of Geography and Statistics (IBGE). The IPCA is used by the Central Bank (BC) to establish official inflation goals.
According to the IBGE, January’s index was influenced by increases in fuel price and urban bus fare. Fuel alcohol went up 9.87% in comparison to December. Gasoline, which has 25% of alcohol in its formula, went up 1.19% in average.
Urban bus fares, which represent a main chunk of families’ expenses on IPCA calculations, had a 1.82% increment in January. Brasilia and Belo Horizonte had the highest price adjustments (21.05% and 12.5% respectively). In Rio de Janeiro, adjustment reached 5.56%.
Price adjustments that also contributed for the index high were those of new cars (1.39%), vehicle insurance (2.43%), homeowners association fee (1.81%), recreation (1.19%), salaries of domestic servants (1.16%), and vehicle repair (1.05%).
On the other hand, electricity bills got 0.94% cheaper because the insurance against energy blackouts, which began to be charged February 2002, ceased on December 2005.
In January, food went up only 0.11%, against 0.27% in December. Among the 11 regions included in the research, Belo Horizonte had the highest IPCA increase (1.48%), and Recife had the lowest (0.02%). IPCA in São Paulo was 0.30% and in Rio de Janeiro, 0.80%.
The IPCA measures the variation in the expenses of families with income between 1 and 40 minimum wages (US$ 137 – US$ 5.480) in the metropolitan regions of Rio de Janeiro, Porto Alegre, Belo Horizonte, Recife, São Paulo, Belém, Fortaleza, Salvador, Curitiba, Goiânia, and Brasília.