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Reuters
22-05-2025
- Business
- Reuters
Mexico inflation rises past central bank target in early May
MEXICO CITY, May 22 (Reuters) - Mexico's headline inflation rose more than expected in the first half of May, data from the national statistics agency showed on Thursday, jumping outside the central bank's target range for the first time this year. Consumer prices rose 0.09% in the first 15 days of the month from the previous half-month period, bringing the annual rate through the month's first half to 4.22%. Analysts polled by Reuters had forecast an annual rate of 4.01%. The Bank of Mexico, which targets an inflation rate of 3%, plus or minus one percentage point, cut its benchmark interest rate by 50 basis points last week — its third straight cut of that magnitude — bringing it to 8.5%, the lowest since August 2022. The closely watched core price index (MXCPIH=ECI), opens new tab, which strips out some volatile food and energy prices, climbed 0.16% in early May. Capital Economics' Kimberley Sperrfechter said the rise in headline inflation is "unlikely to sway the central bank's thinking, and expects a rate cut at the bank's June meeting given the weak state of Mexico's economy. Banco BASE, meanwhile, said in an analysis note that it would be "prudent" for the Bank of Mexico pause its rate-cutting cycle, noting that annual core inflation rose to its highest level since August 2024. "This is a cause for concern, as the core component determines the trajectory of headline inflation over the medium and long term, and its recent upward trend suggests that the Bank of Mexico has not yet achieved sustained inflation convergence to the 3% target," Banco BASE said.
Reuters
22-04-2025
- Business
- Reuters
Mexico's annual inflation seen slowing in the first half of April
MEXICO CITY, April 22 (Reuters) - Mexico's annual inflation likely slowed in the first half of April, a Reuters poll on Tuesday showed, supporting chances that the central bank will again cut its key rate by half a percentage point in May. The median estimate from 10 participants showed an annual headline inflation rate of 3.89% in the month's first half, down from 3.93% in the second half of March. (MXCPHI=ECI), opens new tab Annual core inflation, considered a better measure of price trends because it excludes highly volatile products such as food and energy, is seen at 3.78%. (MXCPIC=ECI), opens new tab Prices are expected to have risen 0.09% from the previous two weeks, while the core index is expected to have increased 0.21%, according to the survey. Official data will be released on Thursday. (MXCPIF=ECI), opens new tab, (MXCPIH=ECI), opens new tab The Bank of Mexico, which has an inflation target of 3% plus or minus one percentage point, cut its benchmark interest rate by 50 basis points last month, its second consecutive reduction of that magnitude, and said it may consider similar cuts going forward if the inflation environment allows. The bank's next rate announcement is scheduled for May 15, opens new tab, and although economic growth does not fall under its mandate, analysts believe the weak outlook stemming from global trade tensions may add to the argument for continuing the monetary easing cycle.
