MEXICO CITY--Mexico's annual inflation eased in October for the first time in five months, fading away from the 2-1/2 year peak recorded the previous month and giving room for the central bank to delay a possible rate increase.
The consumer price index rose 4.60% last month from a year earlier, slightly below expectations, compared with 4.77% at the end of September, Mexico's national statistics agency said Thursday.
Consumer prices rose 0.51% in October from September, much less than the previous year, after a fall in volatile fruit and vegetables prices. The cost of green tomatoes decreased 4%, while oranges plummeted 27%.
Easing inflation and falling food prices are expected to make life easier for the central bank, which has already sent strong signals that it is ready to hike rates to cool demand and contribute to bring down prices.
After annual inflation in September hit its highest level since March 2010, the bank said in its latest policy decision on Oct. 26 that a rate increase would be appropriate "soon" if prices don't enter a sustained downward path towards its 3% permanent target.
Although the central bank attributes the uptick seen in recent months to a supply shock caused by agricultural products, Gov. Agustin Carstens also has said a rate increase could be needed to prevent higher food prices from having a broader impact on overall inflation and to anchor inflation expectations.
The core CPI, which excludes energy and fresh fruit and vegetables, rose 0.23% in October from September, in line with expectations, pushing the annual rate down to 3.58% from 3.61%.
The core inflation rate, closely watched by the central bank because it better reflects underlying inflationary pressures, is seen partially helped by the stronger peso, making imports cheaper.
Merchandise prices slowed down, while services prices remained broadly flat. The Bank of Mexico has left interest rates unchanged at 4.5% since July 2009 as the Mexican economy has grown steady and prices have been relatively under control until this year.
The next policy decision, the last one of 2012, is due to be announced on Nov. 30.
nasdaq.com
The consumer price index rose 4.60% last month from a year earlier, slightly below expectations, compared with 4.77% at the end of September, Mexico's national statistics agency said Thursday.
Consumer prices rose 0.51% in October from September, much less than the previous year, after a fall in volatile fruit and vegetables prices. The cost of green tomatoes decreased 4%, while oranges plummeted 27%.
Easing inflation and falling food prices are expected to make life easier for the central bank, which has already sent strong signals that it is ready to hike rates to cool demand and contribute to bring down prices.
After annual inflation in September hit its highest level since March 2010, the bank said in its latest policy decision on Oct. 26 that a rate increase would be appropriate "soon" if prices don't enter a sustained downward path towards its 3% permanent target.
Although the central bank attributes the uptick seen in recent months to a supply shock caused by agricultural products, Gov. Agustin Carstens also has said a rate increase could be needed to prevent higher food prices from having a broader impact on overall inflation and to anchor inflation expectations.
The core CPI, which excludes energy and fresh fruit and vegetables, rose 0.23% in October from September, in line with expectations, pushing the annual rate down to 3.58% from 3.61%.
The core inflation rate, closely watched by the central bank because it better reflects underlying inflationary pressures, is seen partially helped by the stronger peso, making imports cheaper.
Merchandise prices slowed down, while services prices remained broadly flat. The Bank of Mexico has left interest rates unchanged at 4.5% since July 2009 as the Mexican economy has grown steady and prices have been relatively under control until this year.
The next policy decision, the last one of 2012, is due to be announced on Nov. 30.
nasdaq.com
No comments:
Post a Comment