Our view: The number aligned with our bullish scenario and pressures concentrated on ex-core items. Highlight the deceleration of underlying services both in the original data and in the seasonally adjusted, without additional surprises for the market.
The IPCA for April recorded an increase of 0.38% MoM, above our projection (0.33%) and the market median (0.35%).
Regarding our number, the bullish surprises were concentrated in Administered prices, with a more pressured increase in Gasoline (+5bps) and Food at Home (+2bps), with widespread rises among items, mainly in Fresh Products. On the bearish side, noteworthy is the more moderate increase than expected in Apparel and more intense deflations in residential electricity and Household Supplies.
In underlying services, the surprise compared to our number was concentrated in Food Away from Home and Repairs and Maintenance, despite the cooling in the breakdown of Hairdressing and Barber (-1bp). In the seasonally adjusted metric, the group decelerated to 0.33% from 0.45% in March. It is worth noting that despite the surprise for us, the number was well aligned with the market projection.
In Industrial Goods, highlight the more intense increase in Ethanol (4.76% against projected 3.5%) and in Personal Hygiene (+1bp), a highly volatile item within the index. Thus, the core average recorded an increase of 0.26%, slightly above expectations and accelerating compared to the April IPCA-15 (0.19%).
For more information, please check our IPCA Report.
