Mexico: Inflation stable in May
June 9, 2014
In May, consumer prices fell 0.32% over the previous month. The reading followed the 0.19% decrease registered in April and was broadly in line with the 0.35% drop the market had expected. The monthly fall in prices reflects a seasonal decrease in energy tariffs owing to the beginning of the summer electricity subsidies, which prompted non-core consumer prices to fall 1.64% over the previous month. Conversely, core consumer prices rose 0.09% in May.
Owing to the monthly fall, annual headline inflation was unchanged at April’s 3.5% in May, which marked the lowest level since October 2013. Inflation remained within the Central Bank’s inflation target of 3.0% with a 1.0% tolerance margin.
Core consumer prices, which do not take into account prices for fresh food, fuels and regulated prices, rose 0.09% over the previous month (April: +0.29% month-on-month). Annual core inflation inched down from 3.1% in April to 3.0% in May.
Author: Ricardo Aceves, Senior Economist