Inflation in Mexico seen easing in October

October may be marked by a decline in Mexico's inflation rate, but the target level set by the Bank of Mexico is unlikely to be reached. Thus, more and more people tend to think that the projections that follow will insist that the key interest rate will inevitably be raised. 

According to forecasts of some analysts, annual inflation will be 8.46% in October, which is slightly lower than the 8.7% data recorded in August and September. That was the highest number in 22 years.

Other analysts predicted the core inflation rate (which doesn’t include food and energy, which prices are highly volatile) to be 8.44% in October, also the highest in 22 years. 

The Bank of Mexico has been actively raising its key lending rate since June last year. Thus, the key rate has now been raised by a total of 525 basis points to 9.25%. This is necessary in order to achieve the target inflation rate of about 3%.

Last month's consumer price index was up 0.61% from September, and the average forecast relative to monthly core inflation was 0.65%.

The Bank of Mexico is set to announce another interest rate hike this Thursday. This time it’s expected to be 75 basis points. And on Wednesday, October inflation data will be available. The data is collected, analyzed and published by Mexico's National Institute of Statistics and Geography.