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Alphacast High Frequency CPI- August 1st to 31th 2026

Alphacast High Frequency CPI
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Alphacast High Frequency CPI: Inflation was 1.5% MoM in August

August inflation declined further from the previous month, reaching its lowest monthly reading so far this year. Headline prices increased 1.54% MoM, down from 1.78% MoM in July, while annual inflation stood at 32.6% YoY. Inflation accumulated 20.6% during the first eight months of the year, while August’s monthly pace implies an annualized rate of around 20.1%.

The monthly slowdown was mainly driven by regulated and seasonal prices, while core inflation remained broadly stable. Regulated inflation fell sharply to 1.14% MoM, from 1.9% MoM in July, while seasonal inflation slowed to 2.02% MoM from 2.3%. In contrast, core inflation edged up slightly to 1.64% MoM, from 1.6% in the previous month.

Overall, the August print reinforced the moderation in headline inflation, although the improvement was not broad-based. Lower regulated prices accounted for a significant part of the decline, while seasonal pressures also eased. Meanwhile, core inflation remained sticky at around 1.6%, suggesting that underlying inflationary pressures were broadly unchanged from July.

This composition was also reflected in the breakdown of headline inflation. Core prices remained the main contributor to the monthly print, adding approximately 0.93 pp, largely due to their greater weight in the consumer basket. Regulated prices contributed around 0.35 pp, while seasonal components added approximately 0.26 pp. Excluding the direct contribution from regulated prices, monthly inflation would have been close to 1.2%.

The statistical carryover from August into September remained at 0.7%, unchanged from the carryover left by July into August. Meanwhile, end-of-period inflation over the last four weeks stood at around 1.58%, down from approximately 1.85% at the end of July.

At the weekly frequency, inflation also moderated in the latest reading. Headline prices increased 0.32% WoW, down from the revised 0.37% in the previous week. The slowdown was broad-based across components: seasonal inflation eased to 0.39% WoW from revised 0.4%, core inflation declined to 0.35% from 0.41%, and regulated inflation slowed to 0.23% from 0.26%.

The latest available market forecasts remained above Alphacast’s August estimate. The July REM, published on August 6, projected August inflation at 1.8% MoM, around 0.3 pp above Alphacast’s 1.54% estimate. The median forecast for inflation in 2026 stood at 29.79%, 0.2 pp below the previous REM, while inflation for 2027 was projected at 20%.

Methodological update

This week, Alphacast updated the methodology of its High-Frequency Inflation Index. The price sample was expanded by more than 300%, while estimates for the previous 12 months were revised following improvements in price sampling and classification procedures. These changes are strictly statistical rather than econometric and do not modify the underlying conceptual framework of the index.

As a result, the root mean squared error declined from 0.45 pp to 0.29 pp for headline inflation and from 0.71 pp to 0.46 pp for core inflation. This represents a reduction in estimation error of approximately 35% and 36%, respectively.

To illustrate the impact of the methodological update, under the previous methodology July headline inflation would have been estimated at 1.22% MoM, compared with 1.73% MoM under the updated methodology. Similarly, core inflation would have been estimated at 0.93% MoM, compared with the current estimate of 1.59% MoM. This represents an upward revision of approximately 0.52 pp for headline inflation and 0.66 pp for core inflation.

These differences reflect the expansion of the price sample and improvements in sampling and price-classification procedures, rather than a change in the underlying price dynamics observed during the month.

Sources

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