Consumer and producer price indices across three continents fell or decelerated in June, while purchasing managers’ surveys in South Asia and the Middle East pointed to a sudden loss of economic momentum. Sweden’s food prices slipped 0.2% month-on-month, extending a decline that has brought the annual rate to minus 5.6%, largely due to a VAT cut in April. In Brazil, the broad IGP-DI index dropped 0.79% after a 0.80% rise in May, pulled down by a 3.19% plunge in raw material prices. Meanwhile, Bangladesh’s PMI tumbled 9.9 points to 52.9, and Egypt’s non-oil private sector PMI sank to 46.0, its lowest reading since January 2023.

The drivers behind the figures varied by region. Swedish retailers reported intense pressure on suppliers to hold back price increases, with no sign of a reversal, according to price monitor Matpriskollen. Brazil’s disinflation was concentrated at the producer level: intermediate goods inflation nearly stalled, and final goods prices edged down, though consumer prices still rose 0.36%, led by housing and food. In Bangladesh, the post-Eid holiday lull, the onset of monsoon rains, and a drop in demand after the festival combined to brake activity, pushing manufacturing and construction back into contraction territory. Egyptian businesses cited liquidity constraints, raw material shortages, and disruptions linked to the Middle East conflict, which drove up fuel and input costs even as demand weakened.

The consequences are uneven. Swedish consumers are benefiting from the steepest annual food price drop in recent memory, while Brazilian households face a more mixed picture: construction costs accelerated due to a 1.15% jump in labour expenses, even as material prices cooled. In Bangladesh, the manufacturing PMI component for new orders and exports contracted, and firms shed workers, though mainly through attrition. Egypt’s downturn was broad-based: new orders fell at the fastest pace since November 2022, and nearly 27% of surveyed firms reported lower sales, prompting a fifth consecutive month of output cuts.

Forward-looking indicators offer a less gloomy picture. Bangladesh’s future business index anticipates a return to expansion in manufacturing, and Egyptian firms expressed relatively more positive expectations, hoping for reduced regional disruptions and government support. The June data will frame upcoming central bank deliberations, particularly in Brazil, where the pass-through from falling wholesale prices to consumer inflation remains incomplete, and in Egypt, where the central bank has held rates steady amid persistent price pressures.