Mexico Inflation Ticks Up

Mexican annual inflation ticked up slightly in the first half of December to 6.69%, data from the national statistics agency showed on Thursday, keeping pressure on the central bank to maintain borrowing costs at elevated levels, Reuters reported. While inflation is expected to ease at the start of next year as 2017 gasoline price increases fade from the national index, it is proving more persistent than had been expected. The latest figure was up from a rate of 6.63% in November and slightly higher than the consensus forecast of a Reuters poll of financial market analysts, which predicted a reading of 6.64%. The Mexican peso weakened more than 1% after the release of the figures. Mexico’s central bank raised its benchmark interest rate last week by 25 basis points to 7.25%, the highest level in nearly nine years. At the same time, the bank said that annual inflation could accelerate in December. The bank, which targets inflation of around 3%, underlined that it was ready to act again to tame price pressures.