Mexico's Inflation Accelerates to 3.93% in April

Mexico's annual inflation rate accelerated to 3.93% in April, up from 3.8% in March, but remained within the central bank's target range of 3%, plus or minus one percentage point. The core inflation rate, which excludes volatile food and energy prices, also rose to 3.93%. Despite the uptick, energy prices dropped due to seasonal electricity subsidies, while fresh food prices, especially tomatoes, increased. The inflation data is largely in line with market expectations and is not expected to deter the Bank of Mexico from cutting interest rates further, with most analysts predicting a half-point cut to 8.5% at its May 15 meeting. Although gross fixed investment showed only a marginal monthly increase in February and remains down annually, the central bank is likely to continue easing monetary policy amid concerns over a slowing economy. The government projects modest GDP growth for 2025, and private sector forecasts have been recently revised downward, reflecting ongoing economic uncertainty.