| Mexico Inflation Hits 20-Month Low After Rate Hikes Paused Reuters | |
| go to original May 24, 2023 |
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Consumer prices in Mexico fell more than expected in the first half of May, driving annual inflation to its lowest in 20 months, according to the first figures released after the central bank decided to pause interest rate hikes.
Prices decreased 0.32% in early May, national statistics agency INEGI said on Wednesday, with 12-month headline inflation reaching its lowest since September 2021 at 6.0%, helping the Mexican peso gain against the dollar.
The fresh data come as Banxico, as the local central bank is known, kept its benchmark interest rate steady at 11.25% last week in a unanimous decision, breaking a nearly two-year rate-hike cycle.
The bank has suggested it might need to maintain rates at current levels for an extended period to bring inflation down to its 3% target, which it does not see being reached until the fourth quarter of 2024.
Some economists, however, do not rule out rate cuts in 2023 in light of the latest inflation figures.
Read the rest at Reuters
Related: Mexico Early-May Prices Fall by More Than Expected (Reuters)
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