By Anthony Harrup
MEXICO CITY--Inflation in Mexico picked up moderately at the start of the year, led by an increase in energy prices.
The consumer price index rose 0.51% in the first two weeks of January, pushing the 12-month inflation rate up to 3.33% from 3.15% at the end of December, the National Statistics Institute said Friday.
Higher prices for gasoline and propane gas contributed to a 2.91% increase in energy costs, and fresh produce prices rose. Services costs were up just 0.06% from the end of 2020, constrained by lower airfares and prices of tourism packages after the holiday season.
Core CPI, which excludes energy and agricultural products, rose 0.24% in the first half of January for an annual rate of 3.83%, compared with 3.80% in December.
With inflation still close to the Bank of Mexico's 3% target, and signs that the economic recovery lost steam in December, the central bank is widely expected to resume its interest-rate cutting cycle next month after remaining on hold at its previous two meetings.
Twenty-four of the 31 banks polled this week by Citibanamex expect the central bank to cut the overnight interest-rate target by a quarter of a percentage point to 4% at its Feb. 11 meeting. The median estimate in the survey is that the policy rate will end this year at 3.75%.
Write to Anthony Harrup at anthony.harrup@wsj.com
(END) Dow Jones Newswires
01-22-21 0745ET
