From annual deflation to renewed inflation in 2026
The General Price Index-Market (IGP-M) tracks price changes across wholesale, consumer, and construction segments, with a particularly strong exposure to producer and wholesale prices. Viewed over 12 months, the index provides a useful measure of how upstream inflationary pressures are accumulating or dissipating and is especially sensitive to commodity prices, exchange rate movements, and changes in production costs.
Recent dynamics
The annual IGP-M rate weakened sharply during 2025. After reaching 8.59% in March 2025, it decelerated through the remainder of the year, falling to 0.92% in October, turning slightly negative in November, and ending December at -1.04%. This marked a clear transition from strong annual inflation to outright deflation in the index.
The deflationary phase deepened at the beginning of 2026. IGP-M stood at -0.90% in January and fell to -2.66% in February, the lowest reading in the period shown. The rate remained negative in March at -1.82%, but the direction changed decisively from April onward.
In April, the 12-month rate returned to positive territory at 0.62%. It then accelerated to 1.96% in May and 3.18% in June before easing modestly to 2.77% in July. Despite the July moderation, the annual rate had risen by about 5.43 percentage points from its February trough, showing a substantial reversal in upstream price momentum during the first seven months of 2026.
Interpretation and economic signal
The 2026 trajectory points to a transition from annual deflation toward renewed inflation in upstream and market-sensitive prices. The move back above zero in April, followed by further acceleration in May and June, indicates that the deflationary impulse that dominated late 2025 and early 2026 lost strength and was replaced by a rebuilding of price pressure.
The July reading of 2.77% was 0.41 percentage point below June, suggesting some loss of short-term acceleration. At the same time, it remained only about 0.19 percentage point below July 2025, despite having been deeply negative just five months earlier. This combination suggests that the main signal in 2026 is not simply volatility, but a pronounced normalization and reflation of the annual IGP-M rate after the February trough.
Because the IGP-M is heavily influenced by wholesale prices, commodities, and exchange-rate-sensitive costs, the rebound should not be interpreted as a direct measure of consumer inflation. However, persistent increases in upstream prices can affect replacement costs, margins, contract indexation, and eventually the transmission of cost pressures through production chains.
Base effects also matter for a rolling 12-month measure, as older monthly observations leave the calculation. Even so, the magnitude of the move from -2.66% in February to positive readings above 3% by June indicates a meaningful change in the annual inflation path rather than a marginal statistical fluctuation.
Conclusion
The defining feature of IGP-M in 2026 has been a rapid reversal from annual deflation to renewed positive inflation. After bottoming at -2.66% in February, the index crossed above zero in April and reached 3.18% in June, before moderating to 2.77% in July.
The July easing suggests that the pace of reacceleration may be stabilizing, but the broader 2026 movement still points to materially firmer upstream price conditions than at the start of the year. The next readings will be important for determining whether the rebound consolidates into a sustained inflationary trend or begins to lose momentum.