Mexico inflation seen back on downward slide in early January: Reuters poll By Reuters

© Reuters. Pedestrians are seen on the streets in Mexico City, Mexico March 24, 2020. REUTERS/Gustavo Graf/File Photo

MEXICO CITY (Reuters) – Mexican headline inflation likely eased in the first half of January after ticking up for the past four consecutive half-month periods, a Reuters poll showed on Tuesday.

Accelerating inflation in November and December contributed to cautious outlooks at the Bank of Mexico, which has so far resisted lowering Mexico’s benchmark interest rate from its current all-time high.

A median forecast of 14 analysts predicts annual headline inflation of 4.78% for the first 15 days of the month, resuming a downward trend that began after inflation hit a record high of 8.77% in September 2022.

The closely watched core index, which strips out highly volatile energy and food prices, is seen falling to 4.78% in early January, which would be its lowest since August 2021.

Compared to the previous two weeks, analysts estimated headline inflation rose 0.38%, while core inflation was up 0.25%, the poll showed.

A survey of economists conducted by Citibanamex this week showed that a large segment of the market expects the Bank of Mexico to begin cutting the benchmark rate at its meeting in March.

Mexico’s national statistics agency will publish official inflation data for the first half of January on Wednesday.

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