Mexico City, June 8 — Inflation in Mexico likely continued its downward trend in May, according to a Reuters poll, strengthening expectations that the central bank will keep interest rates steady for an extended period.
A survey of 15 economists estimates that annual headline inflation eased to around 4.03% in May, down from 4.45% in April. If confirmed, this would mark the second straight month of cooling price growth, although inflation would still remain above the Bank of Mexico’s official target of 3% ±1 percentage point.
On a monthly basis, consumer prices are projected to have declined by about 0.12%, helped by seasonal electricity subsidies in certain regions and lower food prices, particularly for fruits and vegetables.
Core inflation, which excludes volatile components, is also expected to show gradual improvement, slowing to 4.20% year-on-year from 4.26%. This would represent the fourth consecutive monthly decline and the weakest reading since May 2025. However, on a monthly basis, core prices are still forecast to rise by 0.24%, reflecting persistent underlying pressure, partially offset by promotional activity from Mexico’s “Hot Sale” online sales period.
The Bank of Mexico recently reduced its benchmark interest rate by 25 basis points to 6.50% in early May, though policymakers signaled that rates may remain unchanged going forward. The decision was not unanimous, with deputy governors Jonathan Heath and Galia Borja favoring keeping rates at 6.75%.
Market projections from Citi and central bank surveys suggest interest rates could remain at 6.50% through 2026 and 2027.
Official inflation data will be released by Mexico’s statistics agency INEGI on Tuesday, while the next monetary policy meeting is scheduled for June 25.