Mexican consumer prices rose more than expected in August, rising at the fastest pace since January, and pushing the annual inflation rate up for a fourth consecutive month.
Prices increased 0.36 percent from a month earlier, the national statistics institute said on its website today, compared with the 0.31 percent median forecast of 22 economists surveyed by Bloomberg. The inflation rate climbed to 4.15 percent, the highest since February and above the 2 percent to 4 percent target range for a second consecutive month.
The central bank, led by governor Agustin Carstens, left borrowing costs unchanged at a record-low 3 percent last week, saying the economy showed signs of recovery without pressuring inflation. The August price increases were led by beef, pork and chicken costs, with an additional push coming from low-octane gasoline and electricity, the statistics institute said.
"Volatility in peso-denominated food and energy prices is lifting inflation above the central bank’s target," Bill Adams, senior international economist at PNC Financial Services Group Inc. in Pittsburgh, said in an e-mailed statement. "But since these prices are highly volatile and influenced by many factors beyond domestic monetary policy, the central bank is likely to look past them in setting policy."
The peso weakened 0.8 percent to 13.2367 per U.S. dollar at 9:13 a.m. in Mexico City.