The General Price Index – Market (IGP-M), known as rent inflation, lost strength from June to July and closed the month at 0.61%. In the previous month, the index had registered 0.81%. The data was released this Tuesday (30), in Rio de Janeiro, by the Brazilian Institute of Economics (Ibre) of the Getúlio Vargas Foundation.
A slowdown does not mean that prices have become lower, but that they have risen less within a comparison period.
In the accumulated total for 2024, the IGP-M is 1.71%, and in the sum of 12 months, it reaches 3.82%.
The FGV calculates the IGP-M by combining three other indexes: the Broad Producer Price Index (IPA), which measures the evolution of wholesale prices, that is, for the producer; the Consumer Price Index (IPC), which measures the cost of the household consumption basket; and the National Construction Cost Index (INCC), which is reflected in the works.
Slowdown
The three components of the IGP-M showed a slowdown from June to July, despite the devaluation of the real – which makes imported products more expensive – and the adjustments of administered prices, such as gasoline and energy.
“The significant drop in food prices stands out in natureboth in the producer and consumer indexes. Within the scope of the INCC, the increase in labor was lower, which contributed to the cooling of inflation in this segment”, explains the research coordinator, André Braz.
Within the IPA, the loss of momentum in inflation was driven mainly by the food subgroup in naturewhose rate went from 3% to -4.43%, between June and July.
In the IPC, of the eight classes that make up the index, five recorded a slowdown. The biggest impact came from the food group, whose variation went from 0.96% in June to -0.84% in July.
“Within this expense class, it is important to highlight the vegetables and legumes sub-item, which went from 5.36% in the previous measurement to -8.78% in the current one”, highlights the FGV.
Twelve months
Although inflation has slowed down over the months, the 12-month accumulated figure has increased. In June, it was 2.45%, a variation that rose to 3.82% in July. This is explained by the fact that the calculation base used the data for July 2023, which led to deflation (price decline) of 0.72% for the set of months.
The IGP-M is known as rent inflation because it serves as the basis for calculating the annual adjustment of many real estate contracts.
