Mexico's annual inflation rate declined to 3.55% in the first half of June, the national statistics agency reported on Wednesday. The reading was lower than market forecasts and represented a slowdown from the pace recorded in May's first half.
The latest figure compares with 4.11% recorded in the first half of May. Economists surveyed ahead of the release had anticipated a rate of 3.77% for the early June reading.
On a month-on-month basis, consumer prices in Latin America's second-largest economy fell 0.11% in the first half of June. That outcome contrasted with the consensus expectation of a 0.10% increase among economists polled.
Breaking out components of price growth, the core price index - which omits certain volatile items such as food and energy - rose 0.19% in early June. That gain was marginally below the 0.21% rise economists had expected.
Details and context
The agency's release focuses on the first half of June rather than a full-month estimate, and the reported figures show both headline and core measures moving more gently than analysts had forecast. The decline in the month-on-month headline measure and the softer-than-expected core increase together account for the lower annual rate of 3.55%.
Implications for sectors
- Consumer-facing sectors may see relief from a slower pace of headline inflation, given the 0.11% month-on-month fall in consumer prices during the period.
- The core index reading, which excludes food and energy, suggests price pressures outside those volatile categories increased at a modest pace, a detail relevant to retailers and service providers.
- Food and energy remain important reference points because the core measure by definition excludes those categories when assessing underlying price trends.
What to watch next
These statistics cover the first half of June and therefore may not capture price developments over the remainder of the month. Observers and market participants will look to subsequent releases for confirmation of whether the deceleration seen in the partial-month data persists across the full month.