The latest weekly CPI report reveals the highest (barring the periods of tariff hikes) daily pace of inflation since the drought-affected 2010. Annual inflation accelerated to 7.6% YoY as of 26 May, from 7.3% YoY at the end of April.
Looking through the details, pork inflation, although still one of the key drivers, moderated slightly, suggesting that price gains across non-reported items must have accelerated. On the latter point, there is no complete set of product details, but among the most likely drivers might be either accelerating inflation in meat-related products (that lag the upsurge in pork prices) or a delayed FX-pass through into core items.
The weekly prints point to a 0.9-1.0% MoM increase in CPI, implying 7.6-7.7% in YoY terms. Looking beyond May, headline CPI might continue to accelerate until the middle of June (to a peak of 7.8-8.0% YoY) as the shock on the pork/meat market proves to be rather sharp and persistent, but could moderate starting from July on tariffs, the base effect, a fading FX pass-through, and demand-pull disinflation.