Inflation rises 0.24% in June and Galípolo will have to explain himself to Haddad for exceeding the target

The country's inflation in June rose 0.24%, mainly caused by the increase in residential electricity, according to IBGE data released this Thursday (10). The Broad Consumer Price Index (IPCA), used as the official indicator, rose due to the resumption of the red tariff flag on electricity bills , with an impact of 2.96% in the month.

The rise in inflation pushed the 12-month cumulative inflation rate to 5.35%, exceeding the government's 4.5% target ceiling. This prompted Central Bank President Gabriel Galípolo to write a letter to Finance Minister Fernando Haddad explaining the reasons for the increase and what will be done. Since the beginning of the year, the cumulative inflation rate has reached 2.99%.

“With a 6.93% increase in the first half of the year, residential electricity has been weighing on families' pockets, registering the main individual positive impact (0.27 pp) on the accumulated result for 2025. This variation is the largest for a first half since 2018, when it was 8.02%”, explained Fernando Gonçalves, IPCA manager.

The extra fee of R$4.46 for every 100 kWh on electricity bills caused the Housing item to have the greatest weight in the month's inflation (0.99%), followed by Clothing (0.75%), Transport (0.27%) and Personal expenses (0.23%).

Food, which was the biggest culprit in the first months of this year, closed with a 0.18% drop, the only group of the nine surveyed by the IBGE that had a negative result in June. In total, it was nine consecutive months that Brazilians felt a greater burden on their pockets when going to the supermarket.

According to the IBGE, the biggest drops in the month were in chicken eggs (-6.58%), rice (-3.23%), and fruit (-2.22%). On the other hand, tomatoes returned to the list of most expensive foods, with a 3.25% increase.

"If we removed food from the IPCA calculation, the monthly inflation rate would be 0.36%. And if we removed electricity, it would be 0.13%," Gonçalves noted.

The institute cited that food at home in general fell by 0.43% in June, unlike meals outside the home, which rose by 0.46% in the month.

The 12-month inflation target breach prompts Galípolo to once again explain to Haddad the reasons behind this result. This will be his second time making this announcement as president of the Central Bank. The statement is expected to be released at 6 p.m.

“All of us at Copom (Monetary Policy Committee) are quite uncomfortable. [...] I already have this beginning that bothers me a lot in my management of, in six months, having to write the second letter of non-compliance with the target,” said Galípolo in a public hearing at the Finance and Taxation Committee of the Chamber of Deputies on Wednesday (9).