MEXICO CITY (Reuters) – Mexico’s annual inflation sped up in March but remained within the central bank’s target range, data released on Wednesday showed, giving credit to expectations that the monetary authority will further trim its benchmark interest rate by half a percentage point.
Consumer prices in Latin America’s second-largest economy were up 3.80% in the 12 months through March, statistics agency INEGI said, in line with the 3.80% from analysts polled by Reuters and up from 3.77% in the previous month.
Despite the increase, inflation remained within the Bank of Mexico’s target band of 2% to 4%.
In March the central bank cut its benchmark rate by 50 basis points to 9%, the lowest level since 2022, and said that the size of the cut could be matched in future decisions if the inflationary environment allowed.
Lower rates could also provide much-needed support to Mexico’s struggling economy, which, like other countries, faces headwinds from U.S. President Donald Trump’s sweeping trade policies.
Mexico’s 12-month core inflation index, often seen as a more reliable measure of price trends as it excludes volatile energy and food prices, came in at 3.64% in March, INEGI said, in line with market expectations.
(Reporting by Ricardo Figueroa; Writing by Natalia Siniawski; Editing by Kylie Madry)
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