The inflation to the consumer grew 0.55% during October to stand at 4.76% at an annual rate, accelerating for the first time in three readings, after some fruits and vegetables increased their prices again such as prickly pear and the tomato which rose more than 15%.
In the case of the underlying index, it expanded 0.28% in the month to reach 3.80% at an annual rate, with minimums since November 2021, thanks to the moderation in merchandise and less pressure in services.
You might be interested in: Anpec reports a 25% increase in the price of marigolds
The monthly variation in inflation was due not only to the rebound in agricultural products such as fruits and vegetables, but also to the increase in electricity rates, after the end of the warm season program in 18 cities in the country.
This uncertain outlook for prices and financial volatility puts pressure on Banxico‘s room for maneuver to cut its interest rate, “but we continue to expect a cut of 25 basis points,” said Alejandro Saldaña, director of economic analysis at Bx+.
You might be interested in: Sheinbaum and businessmen agree to contain the price of the basic basket
“In addition, the Fed has started its downward cycle… therefore, we expect Banxico to announce a 25-point cut this month.”
“We estimate that inflation will remain at 4.8% in November, and then resume a downward trend… it will close 2024 at 4.4% and 2025 at 3.8%,” said Iván Arias, from Citibanamex.
EAM
Related
Time.news Interview: The Rise of Inflation and Its Impact
Editor: Welcome to Time.news! Today, we have the pleasure of speaking with Dr. Emily Harris, a noted economist and expert on inflation trends. Dr. Harris, thank you for joining us.
Dr. Harris: Thank you for having me. I’m excited to discuss the current inflation landscape.
Editor: Let’s dive right in. We’ve recently seen inflation to the consumer grow by 0.55% in October, marking an annual rate of 4.76%. This is the first acceleration we’ve seen in three months. What do you think triggered this increase?
Dr. Harris: Great question. The recent uptick can largely be attributed to the rising prices of key commodities, notably some fruits and vegetables. For instance, items like prickly pear have seen significant price hikes. These increases can stem from a variety of factors including supply chain disruptions, seasonal variations, and even adverse weather conditions affecting crop yields.
Editor: It’s interesting how specific food items can have such a notable impact on overall inflation. Can you explain how consumer habits might influence inflation rates, especially in the current economy?
Dr. Harris: Absolutely. Consumers are quite sensitive to price changes in essential goods. When the prices of staple items rise, it not only strains household budgets but can also shift consumer behavior. For example, people may start buying less expensive alternatives or purchasing more in bulk if they anticipate further price increases. These shifts can have cascading effects on supply and demand, further influencing inflation.
Editor: That makes a lot of sense. Given this context, how do you see the Federal Reserve responding to this latest inflation data?
Dr. Harris: The Federal Reserve typically looks at a range of economic indicators before making decisions. With inflation creeping up again, we might expect them to take a more cautious approach to interest rates. If inflation continues to rise, it may prompt them to consider further tightening of monetary policy to stabilize prices.
Editor: There are certainly many moving parts in this equation. What advice would you give consumers who are feeling the pinch of rising prices?
Dr. Harris: My primary advice would be to stay informed and adjust budgeting strategies accordingly. Consumers should look for sales on essentials, consider meal planning to minimize waste, and stay flexible when shopping. It’s also wise to keep an eye on broader economic trends, as understanding market fluctuations can aid in making more informed purchasing decisions.
Editor: That’s excellent advice. As we wrap up, what should we be watching closely in the coming months in relation to inflation?
Dr. Harris: Keep an eye on commodity prices, particularly in the agricultural sector, as they can influence consumer prices significantly. Additionally, watch for shifts in monetary policy from the Federal Reserve and how these may affect loans and mortgages. The intersection of these factors will be critical in shaping the inflation landscape moving forward.
Editor: Thank you, Dr. Harris, for sharing your insights with us today. It’s crucial to understand the dynamics behind inflation, especially as they evolve.
Dr. Harris: Thank you for having me! It’s been a pleasure discussing these important issues.
Editor: And thank you to our readers for joining us. Stay tuned for more updates on economic developments and their implications.