The rise in fuel prices is already causing a review of short-term inflation. With the 24.9% increase in the cost of a liter of diesel and 18.8% in the cost of gasoline at refineries, announced on Thursday (10) by Petrobras, the Brazilian Institute of Economics, of Fundação Getúlio Vargas (FGV Ibre ), projects that March inflation will close the month at 1.15%.
The level is higher than the National Broad Consumer Price Index (IPCA) of February, announced this Friday (11) by the Brazilian Institute of Geography and Statistics (IBGE), of 1.01%. According to economist André Braz, coordinator of the FGV Price Index, the variation will be significant.
“The readjustments do not reach the same magnitude for the pump at gas stations. For March, we forecast an inflation of 0.75%. With this increase, there will be an increase of 0.45 percentage point. The impact will not be fully felt this month because the announcement starts to take effect now, on the 11th. So, to give 30 days, there will also be an impact in April”, he ponders.
According to the economist’s calculations, the absorption of the readjustment by inflation will also have a relevant impact on the April rate. “For the fourth month of the year, the projection was 0.5%. Now, with an increase of 0.35 percentage point, the sum will reach 0.85%”, concludes the specialist.
The rise of diesel generates more inflationary impact than gasoline. This is because he is responsible for public transport and freight freight, transported across the country by trucks, while gasoline is more restricted to the family’s basket of products. In this sense, the product does not contribute to spreading inflation to other segments.
In 2021, the IPCA closed the year up 10.06%, driven by the 21.03% increase in the transport group. Over the year, gasoline rose 47%, while diesel rose 46%, according to IBGE figures. For 2022, the National Monetary Council has set the center of the inflation target for 2022 at 3.5%. However, financial market projections, reflected in the Central Bank’s Bulletin Focus, are at 5.65%.
Source: CNN Brasil
I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.
