Mexico's Inflation Rate Ends 2020 at 3.15%

By Anthony Harrup

MEXICO CITY -- Mexico's inflation rate picked up moderately in 2020, ending December practically in line with the central bank's 3% target.

The consumer price index rose 0.38% in December from the previous month, leaving the annual inflation rate at 3.15%, down from 3.33% in November but above the 2.83% at the end of 2019, the National Statistics Institute said Thursday.

Core CPI, which excludes energy and agricultural products, rose 0.55% in December and ended the year up 3.8%, compared with 3.59% at the end of 2019.

Higher energy costs, including gasoline, and increases in tourism packages over the Christmas and New Year holiday season were partially offset last month by lower fruit and vegetable prices. For all of 2020, core goods prices rose 5.52% and services increased 1.95%.

Sticky core inflation has been among the reasons for the Bank of Mexico's caution in lowering interest rates to confront the sharp economic downturn brought on by business closures and other measures to slow the spread of the coronavirus.

The central bank cut its overnight interest-rate target to 4.25% from 8.25% between August 2019 and September 2020, but left the rate unchanged at its two most recent meetings. The bank's next monetary policy meeting is scheduled for Feb. 11.

Write to Anthony Harrup at [e-mail]

(END) Dow Jones Newswires

01-07-21 0756ET