Mexico Inflation March 2016


Mexico: Inflation moderates in March

April 7, 2016

Consumer prices rose 0.15% in March, which fell short of the 0.17% increase the markets had expected. March’s increase was slower than February’s 0.44% rise and was the slowest in nine months. According to the National Statistics Institute (INEGI), the slower increase in March stemmed from lower prices for raw food, energy, as well as for government-administered prices.

Following an acceleration in February, inflation moderated in March. Inflation fell from 2.9% in February to 2.6% in March. February had marked the fastest inflation rise since June 2015. Inflation continues to hover below the Central Bank’s target of 3.0%.

The closely watched core consumer prices—which exclude volatile categories such as fresh food and energy—increased 0.36% in March over the previous month, which followed a similar increase in February. Core inflation inched up from 2.7% in February to 2.8% in March, which reflected only modest pressures from higher imports prices due to the weaker peso.

In March, the Central Bank (Banxico) stated that it sees inflation rising slightly above 3.0% in the second and third quarters of 2016, before ending the year close to 3.0%. In 2017, Banxico expects inflation to stabilize around its 3.0% target. Panelists surveyed for this month’s LatinFocus Consensus Forecast expect inflation to end 2016 at 3.3%, which is down 0.1 percentage points over last month’s forecast. For 2017, the panel sees year-end inflation at 3.3%.

Author:, Senior Economist

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Mexico Inflation Chart

Mexico Inflation March 2016

Note: Month-on-month and year-on-year changes of consumer price index (CPI) in %.
Source: Mexico National Statistics Institute (INEGI).

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