Brazil’s consumer inflation slows down in January

Brazil’s Broad Consumer Price Index (IPCA) edged up by 0.25% m/m in January 2021, after increasing by 1.35% m/m in December 2020, reflecting lower prices of energy and airline tickets, and a slowdown in food prices inflation. The Brazilian Electricity Regulatory Agency (ANEEL) reduced the benchmark energy prices in January, as the risks of a water shortage in hydroelectric reservoirs diminished in the second half of December 2020.

Lower prices of airline tickets also pushed inflation down in January, falling by 19.9% m/m, after jumping by 28% m/m in December. Prices of food and beverages, on the other hand, influenced the overall inflation in the first month of 2021, growing by 1% m/m, compared to 1.7% m/m in December 2020. On an annual basis, the overall IPCA grew by 4.56% y/y in January, compared to 4.52% y/y in the end of 2020.

Read the latest CEIC Leading Indicator analysis for Brazil, 'Vaccination delays hamper Brazil’s economic recovery'.