IPCA-15 for September contributes to less tightening of the Selic rate, economists say (Image: REUTERS/Adriano Machado)
The lower-than-expected rise in the Broad National Consumer Price Index 15 (IPCA-15) in September brings greater comfort to Banco Central in relation to inflation current, economists assess. The index rose 0.13% in the month, slowing down compared to the 0.19% recorded in August.
By raising the Selic to 10.75% per year last week, the Monetary Policy Committee (Copom) highlighted the concern about the IPCA full, as well as with the underlying inflation measures, above the target in the latest releases.
With that, attention was focused on the performance of services and cores in the IPCA preview for this month.
Underlying services came in at zero in this reading, impacted by promotions at cinemas, car insurance, car repairs and hairdressing. The average of the cores also came in below expectations (0.18%).
Labor-intensive services surprised on the downside. “This was one of the positive news stories today. As was our inertial services metric, which hit its lowest point since September 2022, as a seasonally adjusted and annualized three-month moving average measure, at 3.98%,” says the inflation strategist at warrenAndrea Angelo.
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“We expect labor-intensive services to close the year at 5.3% and underlying services to be close to 5.8%. It is clear that, so far, what we expect from now on is a worsening of this dynamic, reflecting the favorable conditions in the labor market in which all economic indicators linked to income and employment remain quite strong.”
Angelo highlights that the inflation preview was weaker than expected, precisely because of specific items, which should be returned in the next releases. However, she emphasizes that it brought good news in the qualitative part.
The strategist understands that the dynamics shown in the IPCA-15 are in line with the expectation of Selic rising to 11.5% by January 2025, at a rate of 0.25 percentage points (pp). “Current inflation remains more benign than previously predicted,” she says.
Online, the chief economist of Armor CapitalAndrea Damico, says that, although the “extremely benign” data does not prevent the BC from continuing to raise interest rates, it contributes to a smaller cycle.
“We are in a cycle of 1.50 pp, but with a minimized risk of a larger cycle of 2.00 pp. This data shows that inflation has not yet reacted to stronger economic activity.”
The IPCA-15 groups
In the group of housingthe main impact came from residential electricity, which went from -0.42% in August to 0.84% in September, with the red tariff flag level 1. The highlight was also the increase in the water and sewage rate (0.38%) and piped gas (0.19%).
The grouping of food and drinks was the bullish surprise of the month and advanced 0.05%.
Food at home varied by -0.01%, with a decrease in onions (-21.88%), potatoes (-13.45%) and tomatoes (-10.70%) and an increase in papaya (30.02%), bananas (7.29%) and ground coffee (3.32%). Food away from home also increased in price (0.22%), due to less intense increases in snacks (0.20%) and meals (0.22%).
“We expect this group to accelerate again to 0.48% at the end of September and reach increases of more than 1% in the last two months of the year, due to beef. For the year, the meat group should show an increase of 4%. In the same sense, we see food at home ending closer to 6.5%”, says Angelo, from Warren.
The other three groups that recorded increases in the IPCA-15 for September were health and personal care (0,32%), residence articles (0,17%), clothing (0,12%), education (0,05%) e communication (0,07%).
Just personal expenses (-0,04%) e transports (-0.08%) fell. In the latter, the result was influenced by gasoline (-0.66%). In relation to other fuels (-0.64%), ethanol (-1.22%) fell, while vehicle gas (2.94%) and diesel oil (0.18%) rose. Airline tickets recorded an increase in prices (4.51%).