Inflation Mexico’s headline interest rate fell more than expected in October but remained above the official target, supporting prospects that the central bank will maintain its current policy rate for an extended period.
The National Consumer Price Index (INPC) was at 4.26% on an annual basis, the lowest since March 2021, after rising to a more than two-decade high last year, according to data released on Tuesday. National Institute of Statistics and Geography (Inegi).
Analysts had expected the annual interest rate to be 4.28%.
Underlying inflation, considered a better parameter for measuring price developments because it excludes products with high volatility, fell for the 18th day in a row to 5.50%, the lowest level since November 2021.
This includes monthly costs which increased by 0.34% and Services by 0.44%.
The products with the largest increase were Carrots, with a variation of 20.96%, and Electricity, with 19.23%. Tomato, on the other hand, had the largest decline, with its monthly variation declining by -14.46%, followed by Onions and Oranges with -11.72% and -11.91 respectively.
In return, the non-underlying price index was 0.34% in monthly interest and 0.56% in annual interest. Prices for agricultural products fell 2.09%, while energy prices and government-approved tariffs rose 2.57%.
This increase was primarily due to the completion of summer season electricity rate program subsidies in 18 cities across the country.
Finally, the minimum consumption basket price index registered a monthly increase of 0.33% or 3.83% year-on-year in the first half of October 2023. In the same period of 2022, the corresponding values were 0.50 and 9.09%, in that order.
In August, the Bank of Mexico (Banxico) decided to maintain the benchmark interest rate at the historical maximum of 11.25% for the fourth day in a row, citing the complicated and uncertain outlook for inflation, and adjusted its approach to indicator towards the 3% target. for the second quarter of 2025.
Source: La Neta Neta
Karen Clayton is a seasoned journalist and author at The Nation Update, with a focus on world news and current events. She has a background in international relations, which gives her a deep understanding of the political, economic and social factors that shape the global landscape. She writes about a wide range of topics, including conflicts, political upheavals, and economic trends, as well as humanitarian crisis and human rights issues.
