Mexicans experienced the highest cost in January since 2001; inflation stood at 7.94%

Mexicans faced the biggest slope in January in more than 20 years, according to the most recent information released by the National Institute of Statistics and Geography (Inegi).

In the first half of January, the National consumer price index (INPC) increased 0.46% compared to the last fortnight of 2022.

With this, annual inflation was 7.94%, the highest price increase for the first half of January since 2001, when the increase was 8.37 percent.

Likewise, it supposed an acceleration from the level reported in the second half of December, when consumer prices increased by 7.86 percent.

As every year, with price adjustments for various issues such as the increase in the minimum wage, analysts expected an acceleration in inflation; however, the data released by the Inegi was higher than the rate of 7.87% expected by the market.

underlying rally

Within the Inegi report it was observed that the Underlying inflation —which eliminates the most volatile goods and services from its calculation— picked up after three fortnights slowing down and continued as the greatest pressure for inflation.

In the first fortnight of the year, underlying inflation was 8.45% per year.

Within this item, merchandise became more expensive by 11.02%, an increase explained by the annual rates of 14.09% for food, beverages, and tobacco, as well as 7.57% for non-food merchandise.

On the services side, inflation was 5.47 percent.

For its part, non-core inflation was 6.44 percent. Within this item, agricultural products presented an increase of 9.99%, while energy and rates authorized by the government of 3.59 percent.

ana.martinez@eleconomista.mx