Mexico’s inflation rate is on a downward trend, bringing relief to consumers. The National Institute of Statistics and Geography reported a minimal biweekly variation of 0.09% in the National Consumer Price Index, resulting in an annual increase of 4.66%. This marks the fourth consecutive month of deceleration, surpassing analysts’ expectations.
Chief Economist Alejandro Saldaña attributed this slowdown to decreasing agricultural prices. Despite recent weather-related challenges, experts like Andrés Abadía predict further inflation reduction in the fourth quarter due to less demanding base effects and weakening domestic demand.
Inflation Components
Both core and non-core inflation showed deceleration. Core inflation now stands at 3.95% annually, with goods rising by 2.94% and services by 5.15%. Non-core inflation’s annual increase is 6.73%, driven by higher prices in agricultural products, energy, and government tariffs.
Future Outlook
Analysts from Banorte are cautiously optimistic, anticipating another interest rate cut by Banxico in the upcoming monetary policy meeting to align with the Federal Reserve’s easing cycle. However, Saldaña warns of local market volatility affecting Banxico’s decisions.