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Mexico headline inflation seen up in November, core index to slow: Reuters poll

Published 12/04/2023, 12:27 PM
Updated 12/04/2023, 12:31 PM
© Reuters. FILE PHOTO: The logo of Mexico's Central Bank (Banco de Mexico) is seen at its building in downtown Mexico City, Mexico August 9, 2022. REUTERS/Henry Romero/File Photo

MEXICO CITY (Reuters) - Mexico's headline inflation likely accelerated in November, while the core index would have continued easing, a Reuters poll showed on Monday, reinforcing expectations that the central bank will carry out interest rate cuts starting next year.

A median forecast of 15 analysts projected annual headline inflation for November at 4.40%, up from 4.26% in October, when it hit its lowest since February 2021.

The rebound was attributed mainly to a seasonal increase in electricity prices due to the end of summer subsidies in some cities.

Core inflation, which strips out some volatile food and energy prices, was seen falling for the tenth consecutive moth to 5.34% year-on-year, its lowest level since October 2021.

Last month, Mexico's central bank held its benchmark interest steady at 11.25%, saying it will likely maintain the reference rate at its current level for "some time," reflecting a moderation in language from its previous statements.

Board member Jonathan Heath said in a recent interview that the rate could be cut "once or twice" in 2024.

© Reuters. FILE PHOTO: The logo of Mexico's Central Bank (Banco de Mexico) is seen at its building in downtown Mexico City, Mexico August 9, 2022. REUTERS/Henry Romero/File Photo

Analysts also saw consumer prices speeding up to rise 0.72% in November, while core inflation rose 0.30%.

National statistics institute INEGI will release November inflation data on Thursday.

(Report by Noe Torres; Additional reporting by Gabriel Burin in Buenos Aires)

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