By Anthony Harrup
MEXICO CITY--Mexico's annual inflation rate rose in October from the previous month, led by increases in energy costs and the prices of fresh produce, the National Statistics Institute said Monday.
The consumer price index rose 0.61% from September, which pushed the 12-month inflation rate up to 4.09% from 4.01%. Core CPI, which excludes energy and agricultural products, rose 0.24% for an annual rate of 3.98%.
Energy costs rose 2.97% from September, with a 19% rise in electricity as summertime subsidies on residential rates ended for 18 cities. Gasoline prices were lower than in September, while fresh fruit and vegetable prices rose 3.51%.
Inflation moved further above the Bank of Mexico's 3% target as the central bank prepares for its monetary policy meeting on Thursday.
A majority of analysts polled last week by Citibanamex expect the central bank will cut the overnight interest-rate target by a quarter of a percentage point to 4%, and then pause in the easing cycle that began in August 2019.
Grupo Financiero Banorte, which had expected the central bank to leave rates unchanged this month, on Friday changed its forecast to a quarter-point cut.
It cited positive market reaction, including a strengthening of the Mexican peso, in the wake of last week's U.S. presidential election, an improved medium and long-term inflation outlook, and greater risks for the economic recovery in the fourth quarter.
"We think the decision might be split, with at least one and even maybe two members voting for an unchanged stance," Banorte said in a report.
Write to Anthony Harrup at anthony.harrup@wsj.com
(END) Dow Jones Newswires
11-09-20 0749ET
