Macro View

CPI Portugal final data – August’s CPI: 2.76%YoY, Core 2.44%; o/w - Services inflation, 4.38% and Goods: +1.57%. Services inflation keeps increasing, as the job market remains strong

(reading time: 3 mins)

The Portuguese Statistic Institute has just released, August’s CPI final data and its subcomponents (unfortunately, we could not comment yesterday, sorry for any inconvenience).  

We would highlight the following:

• CPI: +2.76%YoY; slightly below preliminary data; sequentially: -22bp; compares with the 12MMA (12 months moving average): 2.4% and 3MMA of +2.6%;
• Core CPI: +2.44%YoY/-20bp MoM; compares with the 12MMA: +2.5% and 3MMA +2.4%;

• Services: +4.38%YoY/+60bp MoM vs. 12MMA: +4.2% and 3MMA: +4.3%;
• Goods: +1.57%YoY/-84bp MoM vs. 12MMA: 1.1% and 3MMA: 1.3%;    
• Energy: -0.18%YoY/-0.38bp MoM vs. 12MMA: +0.4% and 3MMA: -0.9%;

• Food and Non-alcoholic Bev: +3.97%YoY/-29bp MoM vs. 12MMA: +2.6% and 3MMA: +3.6%;
• Clothing and Footwear: -1.42%YoY/-6.45% MoM vs. 12MMA: -1.0% and 3MMA: -1.5%;
• Restaurant/Meals: +6.31%YoY/+40bp MoM vs. 12MMA: +5.9+% and 3MMA: +6.2%;
• Postal Services: +6.15%YoY/ 0%MoM vs. 12MMA: +7.1% and 3MMA: 6.2%;
• Telecommunications -15bp YoY/+56bp MoM vs. 12MMA: +2.7% and 3MMA: -0.5%;
• Rents +5.08%YoY/+36bp MoM vs. 12MMA: +6.0% and 3MMA: 5.1%.

Our comments: August’s CPI final data, slightly below preliminary data; 2.76%YoY and Core data 2.44%; nevertheless, in line or above the moving averages. Services Inflation is consolidating around 4.4%; while Goods inflation is showing upwards pressure, 1.57YoY above moving averages. In a nutshell, the upwards pressure on Services inflation is a consequence of a strong job market, while Goods inflation is slowly moving upwards, so it will be difficult to foresee lower data in the current environment of strong labour market and consumption. Finally, Telecommunication inflation -15bp/+56bpMoM, reflects the operators’ decision to not increase prices in 2025, nevertheless, apparently the new telco operator (started November last year) is not disrupting the market (+56bp MoM surprised, as historical data points to flat or negative change).   

Source: INE, AS Independent Research