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Economy April 7, 2026

Mexico's headline inflation likely rose in March as core pace eased, Reuters poll shows

Survey points to higher headline reading amid falling core inflation and continued central bank rate cuts

By Maya Rios
Mexico's headline inflation likely rose in March as core pace eased, Reuters poll shows

Mexico's headline inflation is estimated to have accelerated in March for a third consecutive month to 4.63% year-on-year, while the core measure likely eased to 4.46%, according to a Reuters poll. The results, if confirmed by official data, would keep inflation above the central bank's 3% target range and support expectations for further monetary easing after an unexpected rate cut last month.

Key Points

  • Headline inflation likely rose to 4.63% year-on-year in March from 4.02% in February, reaching its highest level since October 2024.
  • Core inflation is expected to have fallen to 4.46% from 4.50%, marking the lowest core reading so far this year but still above the central bank's target.
  • The central bank has already cut its policy rate to 6.75% from 7.00% and a private-sector survey implies one more 25 basis point cut by year-end, supporting expectations of continued monetary easing; main market and banking sectors may be affected.

Overview

Mexican inflation trends appear to have diverged in March, with headline inflation likely accelerating while core inflation probably softened, according to a Reuters opinion poll that reflects market expectations ahead of official figures. Headline inflation is estimated at 4.63% year-on-year for March, up from 4.02% in February. Core inflation, which excludes volatile items and is used by policymakers to assess underlying price pressures, is expected to have fallen to 4.46% from 4.50% the month prior.

Implications for policy and markets

Should the statistics agency INEGI publish numbers in line with the poll when it releases the data on Thursday, the headline figure would represent the highest annual rate since October 2024 and would keep inflation above the central bank's target of 3%, plus or minus one percentage point. At the same time, the anticipated decline in core inflation would mark its lowest reading so far this year, though still above target.

Those signals support market expectations that the central bank will continue to cut its benchmark interest rate. The bank last month restarted an easing cycle, reducing its policy rate to 6.75% from 7.00%, and said it will evaluate the "appropriateness and timing" of any further reductions. The decision to cut in the prior meeting surprised investors, who had expected the bank to hold given concerns about global inflation risks linked to the conflict in the Middle East.

Officials and forecasts

Last week, the central bank's Governor Victoria Rodriguez commented that the adjustment period was approaching its end. In addition, a recent central bank survey of private sector analysts projected the policy rate would finish 2026 at 6.5%, which implies one additional 25 basis point cut during the year.

Data timing

INEGI is scheduled to publish the official March inflation report on Thursday. The poll figures represent expectations, not confirmed readings; the official release will determine whether the preliminary picture is accurate.

Bottom line

Market participants are watching the forthcoming official inflation data closely. A higher headline rate combined with easing core inflation would sustain the narrative of gradually declining underlying price pressures while keeping overall inflation above the central bank's target range, thereby informing the timing and magnitude of any future rate cuts.

Risks

  • Ongoing global inflation pressures tied to the conflict in the Middle East could have influenced market expectations and were a factor behind prior market caution; this introduces uncertainty for inflation and monetary policy decisions - impacts bond and currency markets.
  • Headline inflation remaining above the central bank's 3% target range maintains the risk that further rate cuts may be constrained or delayed if inflationary pressures persist - relevant to banks, lenders, and interest-rate-sensitive sectors.
  • Survey-based expectations of only one additional 25 basis point cut in 2026 reflect uncertainty about the timing and appropriateness of future easing steps by policymakers - affects fixed income and financial market positioning.

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