Mexican inflation remained well above the central bank’s target in October


Mexican inflation is expected to have moderated in October but remained well above the central bank’s target, a Reuters poll showed Monday, likely cementing forecasts monetary policymakers will again hike the benchmark interest rate.

The median forecast of 16 analysts sees annual inflation at 8.46% in October, down from a 22-year high of 8.70% registered in September and August.

Inflation has blown past the Bank of Mexico’s target rate of 3%, plus or minus one percentage point, prompting it to increase its key lending rate by 525 basis points to 9.25% during the current hiking cycle, which began in June 2021.

The central bank’s latest monetary policy decision will be announced on Thursday, when it is expected to raise its key interest rate by 75 basis points, following the U.S. Federal Reserve’s three-quarters of a percentage point hike last week.

The closely watched annual core inflation rate, which strips out some volatile food and energy prices, was forecast to hit 8.44% in October, its highest level since August 2000 and up from 8.28% in September, according to the poll.

In October alone, Mexican consumer prices are estimated to have increased by 0.61% from the previous month, while the median projection for monthly core inflation was seen at 0.65%.

Mexico’s statistics institute will release inflation data for October on Wednesday.

Source: El Financiero

Mexico Daily Post