Economists predict that the annual inflation has lost strength for the seventh consecutive month during Augustalthough it would still remain above the official target and support the prospects that the central bank will continue to keep its key rate at its all-time high.
The median of the projections of 10 participants in a Reuters agency survey showed a rate of 4.61% for the general consumer price index, which would be its lowest level since February 2021, after having climbed last year to a record of more than two decades: 8.7%.
For core inflation, considered a better parameter to measure the trajectory of prices because it eliminates high volatility products, estimates indicate that it would have fallen to 6.12%, its lowest level since December 2021.
Last month, the Bank of Mexico (Banxico) decided to keep the reference interest rate at a record high of 11.25% for the third time in a row, warning that it would be necessary to leave it at that level for a long time to achieve convergence to the target of inflation of 3% +/- one percentage point.
Banxico stopped a cycle of monetary tightening that began in 2021 in May with which it raised its rate by 725 basis points. Last week he improved his expectations for headline inflation this year to 4.6%, from the 4.7% previously forecast, and warned that he is closely monitoring the behavior of the core, which, although it has lost strength, remains high.
Only in August, consumer prices would have risen 0.52% compared to the previous month, while for the core index an increase of 0.30% is expected, according to the Reuters survey.
The latest Citibanamex expectations survey indicates that inflation expectations for the closings of 2023 and 2024 remain stable. The projection of general inflation at the end of 2023 increased to 4.70% from 4.67% the previous fortnight, and for the core component it also increased slightly, to 5.17% from 5.16% in the previous survey.
For 2024, the calculation for headline inflation remained at 4%, while for core inflation it decreased marginally to 4% from 4.01% a fortnight ago. The median expectation for the average annual inflation rate in 2025-2029 increased to 3.80% from 3.77%.