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Inflation: Decline in Raw Material Prices Deepens

In Short:


The decline in prices of key raw commodities — including corn, soybeans, wheat, coffee, sugarcane, cattle, poultry, and live hogs — accelerated in May, falling 2.86% after a 0.34% drop in April. The segment was the main driver behind the 1.38% decline in the Broad Producer Price Index (IPA) last month.


Data released Friday by Brazil’s IGP-DI inflation index showed a 0.85% drop in May, reversing a 0.30% gain in April. Year-to-date, the index is up 0.05%, with a 12-month increase of 6.27%. The sharpest price pressures remain concentrated in early-stage production inputs.


Still, according to FGV IBRE economist André Braz, the drop is not immediately passed through to consumers, as the IPA continues to register positive 12-month figures.


Market reports

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