Brazil August electricity prices drop 7.63% on Itaipu bonus, IPCA falls 0.32%

Brazilian electricity prices fell 7.63% in August, driven by the Itaipu bonus, contributing -0.33 pp to the IPCA, which declined 0.32%. This is the largest August drop since the Real Plan and the biggest monthly decline since January 2025. The bonus, a credit from the energy commercialization account, is a one-off factor that may not persist, but it is currently disinflationary.