Residential electricity fell 7,63% in August compared to July and was a key factor in Brazil registering the largest monthly deflation in the last four years, according to data released this Friday (11) by IBGE (Brazilian Institute of Geography and Statistics).
According to the agency, the country's official inflation rate – measured by the IPCA (National Consumer Price Index) – fell 0,32% in August, after rising 0,07% in the previous month. This was the largest monthly drop in the index since August 2022, when the IPCA had fallen 0,36%.
In this scenario, residential electricity had a -0,33 percentage point impact on the August result. This means that, mathematically removing this contribution, the IPCA would have remained close to stability, but in positive territory, at around 0,01%.
The movement is noteworthy mainly because of the change compared to the previous month. In July, residential electricity had risen 3,09% and contributed 0,13 percentage points to inflation.
Itaipu's bonus contributed to the drop in August.
The reduction recorded by IBGE in August was influenced by the Itaipu Bonus, credited to consumers' energy bills. Therefore, the 7,63% decrease does not necessarily represent a structural reduction in electricity tariffs.
The monthly result incorporates the effect of the credit received by consumers during the period. This movement occurred even with the yellow tariff flag in effect, which adds R$ 1,885 for every 100 kWh consumed. With the drop in electricity prices, the Housing group also showed a reduction in the August IPCA (Brazilian consumer price index).
In July, electricity prices rose, preventing deflation.
The change from one month to the next highlights the weight of residential electricity on official Brazilian inflation. In July, as shown by... Canal SolarThe IPCA (Brazilian consumer price index) advanced 0,07%, while residential electricity rose 3,09% and had an impact of 0,13 percentage points on the index.
Without this contribution, the result for that month would have been approximately 0,06% negative. In other words, electricity was sufficient to prevent the country from registering deflation in July.
In August, the opposite occurred: electricity went from being one of the main pressures on inflation to the item with the greatest contribution to the fall in the indicator. Between July and August, the contribution of residential electricity to the IPCA (Brazilian consumer price index) went from... +0,13 to -0,33 percentage points, a difference of 0,46 percentage points.
Energy and its impact on inflation.
Comparing the two months helps to illustrate how variations in residential electricity prices can influence inflation in Brazil. In July, the rise in electricity prices helped keep the IPCA (Brazilian consumer price index) in positive territory. In August, its decrease had a greater impact than the deflation recorded by the overall index.
This happens because residential electricity is part of the Housing group and has a significant weight in the basket of goods and services monitored by the IBGE (Brazilian Institute of Geography and Statistics) to calculate inflation. The IPCA (Broad Consumer Price Index) tracks price variations for families with incomes ranging from one to 40 minimum wages and is considered the country's official inflation index.
all the content of Canal Solar is protected by copyright law, and partial or total reproduction of this site in any medium is expressly prohibited. If you are interested in collaborating or reusing part of our material, please contact us by email: redacao@canalsolar.com.br.
Comments
Comments are moderated before publication.Comments should be respectful and contribute to a healthy debate. Offensive comments may be removed. The opinions expressed here are those of the authors and do not necessarily reflect the views of the author. Canal Solar.