Mexico: Inflation keeps rising in March
April 7, 2017
Consumer prices in Mexico rose 0.61% from the previous month in March, which was slightly above the 0.58% increase the markets had expected. March’s increase followed a 0.58% gain in February and stemmed mainly from a sharp increase in prices for fresh food and also higher prices from non-core consumer prices, which continued to reflect the pass-through effect from a weaker peso.
Inflation climbed to 5.4% in March from 4.9% in February, marking the highest level since July 2009. Inflation continued to move further above the 4.0% upper bound of the Central Bank’s target range, and is expected to remain there for most of the year.
The closely-watched core consumer price index—which excludes volatile categories such as fresh food and energy—increased 0.57% in March from the previous month, which was slower than the 0.76% rise seen in February. The slowdown in March reflected lower energy prices, since the effect of the hike in gasoline prices in January is fading. However, as fresh food prices rose substantially, core inflation rose from 4.3% in February to 4.5% in March, the highest rate seen since January 2010.
Author: Ricardo Aceves, Senior Economist