Mexico inflation undershoots forecasts; core rate returns to target range
Tomatoes and other agricultural prices helped pull inflation lower as the central bank kept its benchmark rate at 6.5% and waits for clearer progress.
- Mexico's annual inflation rate decelerated to 3.10% in early July, marking the eighth consecutive fortnight of decline, according to official data from the national statistics institute INEGI released on Thursday.
- Declines in volatile agricultural prices, particularly a 13.18% drop in tomato costs, drove the moderation during the 15-day period, helping pull the headline rate closer to the Bank of Mexico's target.
- Core inflation, which excludes volatile items, reached 3.95% year-on-year, while Banxico maintained its benchmark interest rate at 6.5% to await clearer signs of convergence toward its target range.
- Analysts at Itau cautioned that current price moderation might stem from temporary factors, noting "weather-related shocks associated with El Niño could pose upside risks in the final months of the year."
- This reading represents the lowest level for any quincena since late 2020, positioning annual inflation within the central bank's target range of 3%, plus or minus one percentage point.
20 Articles
20 Articles
General inflation in Mexico declined for the eighth consecutive fortnight and reached 3.1 percent annually during the first 15 days of July, being its lowest level since December 2020, revealed data from the National Institute of Statistics and Geography (Inegi).
Mexico's inflation falls to its lowest level since 2020
Inflation in Mexico moderated again during the first half of July — the eighth consecutive 15-day period in which the rate declined — settling close to the Bank of Mexico’s target. The national statistics institute INEGI on Thursday reported that the National Consumer Price Index rose 0.07% compared to the second half of June, bringing the annual headline inflation rate to 3.10%. This is the lowest for any quincena, as the half-month period is …
Underlying inflation, which determines the trajectory of overall inflation in the medium to long term, remains above the target set by the Bank of Mexico
Mexico's annual inflation moderated in the first half of July to 3.10%, which supports the Banxico's vision without changes in interest rates.
Coverage Details
Bias Distribution
- 50% of the sources lean Left
Factuality
To view factuality data please Upgrade to Premium
