Inflation in Mexico is 8.70%; in Belgium it is 11.27%

Brussels, Belgium.- We complain, and rightly so, about the high inflation that is affecting the purchasing power of our pesos.

Annualized inflation was 8.7% until last September, the highest since December 2000. The good news is that it did not increase compared to the previous month.

However, core inflation, which is what economists prefer to follow to determine where prices are going, rose from 8.05% in August to 8.28% in September. Regarding the annualized increases compared to last month, those of merchandise in general rose from 10.55 to 10.84%, those of processed foods, beverages and tobacco from 12.94 to 13.38%, those of non-food merchandise from 7.90 to 8.00 %, services from 5.19 to 5.35%, housing from 3.12 to 3.15%, tuition from 3.68 to 4.49% and other services from 7.31 to 7.44 percent.

In the case of the annualized increase in non-core inflation, which is the one with the most volatile prices, it fell from 10.65 to 9.96%, which explains why the general inflation of 8.70 percent has not increased. However, compared to August, in September the prices of agricultural products registered an annualized increase from 14.90 to 15.05%, those of livestock products (meat, dairy, chicken, fish) from 14.68 to 15.79% and the rates authorized by the Government from 5.19 to 5.23 percent. The drop in non-core inflation is explained by the decrease in the annualized increase in the prices of fruits and vegetables from 15.18 to 14.18% and energy prices from 8.14 to 6.16 percent.

In summary, the drop in the prices of fruits and vegetables and energy explain why general inflation did not increase in September compared to August.

But we Mexicans not only eat fruits and vegetables and consume energy, we also purchase all other products and services included in the National Price Index (INPC) whose prices continue to rise.

Therefore, the government’s cautious optimism is by no means justified. Rather it should accept that inflation continues to hit people’s pockets hard.

In Belgium they are also experiencing a price increase not seen since August 1975. In September annualized inflation rose to 11.27 from 9.94% in August. A year ago it stood at 4.16 percent. Here the increase in prices was in housing and public services, from 24.94 to 31.51%; food and non-alcoholic beverages, from 10.15 to 10.75%; recreation and culture, from 4.11 to 4.57%; and restaurants and hotels, from 5.20 to 5.23 percent. The only good news for the inhabitants of this country is that the increase in transportation prices was 10.56% compared to last month, which was 12.26 percent.

Inflation is taking a toll on the popularity of Prime Minister Alexander De Croo, 46, who has headed a seven-party coalition government since October 2020. The most recent polls indicate that if a federal election were held today, the ruling coalition would reach 46.4% against the 53.6% that the opposition would obtain.

If he can put together a coalition, De Croo could stay in office after the 2024 federal election.

High inflation could end that coalition; In Mexico, the price increase does not seem to affect Morena.

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