Mexico Headline Inflation Likely Hit 4.63% in March

Headline inflation in Mexico likely accelerated for the third straight month in March, even as core price pressures showed signs of cooling. According to a Reuters poll of analysts, the headline rate is expected to have reached 4.63% in the third month of 2026, up from 4.02% recorded in February. This projected increase would mark the highest level since October 2024, moving the indicator further away from the central bank's 3% target range. In contrast, core inflation—a metric that strips out highly volatile food and energy prices—is anticipated to have declined for a second consecutive month. Forecasts suggest a dip to 4.46% from 4.50% in the previous month, which would represent its lowest level so far this year despite remaining above official targets. The anticipated data comes after the Bank of Mexico recently resumed its monetary easing cycle. Last month, policymakers lowered the benchmark interest rate to 6.75% from 7%, noting that they would evaluate the timing and necessity of future cuts on a meeting-by-meeting basis. This decision caught many market observers by surprise, as some had expected rates to remain steady due to inflationary risks linked to geopolitical tensions in the Middle East. The national statistics agency, INEGI, is scheduled to release the official March inflation figures this Thursday. Recent surveys of private sector analysts indicate expectations for the benchmark rate to settle at 6.5% by the end of 2026, implying one additional 25 basis point reduction later this year. Governor Victoria Rodriguez recently indicated that the current adjustment period for the bank's monetary policy may be approaching its conclusion.