Core inflation soars to its highest level since August 2000

The price index was located at 8.14% at an annual rate, below the 8.28% registered in the second half of October and moving away from the record in more than two decades of 8.77% that reached until the second half of August, according to with figures released Thursday by the statistics institute.

The figure was also below market estimates, which had anticipated a rate of 8.24%, according to a Reuters poll.

On the other hand, subjacent inflation, considered a better parameter to measure the trajectory of prices because it eliminates highly volatile products, advanced to 8.66%, a level not seen since the second half of August 2000.

Banco de México, which has a permanent inflation target of 3% +/- one percentage point, has raised the referential rate by a total of 600 base points as part of a cycle of increases that began in June 2021, until its current level of 10%.

Its last monetary policy decision this year is scheduled for December 15 and the market anticipates a new increase in the cost of credit, this time of 50 basis points, according to the most recent survey by the financial group Citibanamex.

In the first 15 days of November alone, prices rose 0.56%, while the core index returned a rate of 0.34%. The items that suffered the most increases in the fortnight were electricity and air transport, while onion and domestic LP gas were the ones that fell the most.

await relegation

Banxico’s deputy governor, Jonathan Heath, said Thursday that core inflation could drop in the second half of November after reaching a level not seen since August 2000 in the first 15 days of the month.

“The good ending offers are temporary, so it does not mean that the upward trend in inflation is beginning to subside. We still have persistent inflation ahead of us that we must address forcefully,” said the banker on his Twitter account.

With information from Reuters