Mexico: Headline inflation likely set to edge higher in the first half of May - BBVA
|On Thursday, half-month inflation is due in Mexico. According to Javier Amador, Principal Economist of BBVA Research, fresh food prices will likely drive up the annual headline inflation while core inflation will likely fall back within the narrow range.
Key Quotes:
“Headline inflation is likely set to edge higher in the first half of May. We expect a print of -0.16% 2Wo2W in the first half of May, translating into a 4.58% YoY number, compared to 4.44% in H2 April and 4.41% in April. Our fresh food price trackers signal increases in both fruit and vegetable and meat and egg prices.”
“We expect core inflation to ease. We expect core prices to post a mild increase of 0.03%, consistent with 3.70% in annual terms, compared to 3.87% in H2 April and 3.87% in April. If accurate, core inflation would fall back the narrow 3.6-3.7% in which it had fluctuated for twelve months before edging higher in April.”
“Looking ahead, headline inflation will not fall below 4.0% until August while core prices will hover around 3.6-3.7% the rest of 2Q and in 3Q.”
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