MEXICO CITY, May 7 (Reuters) – Mexico’s annual inflation rate decelerated for the first time this year in April, official data showed on Thursday, paving the way for a possible cut of borrowing costs.
Consumer prices in Mexico rose 4.45% in the year through April, easing from a 4.59% increase the prior month and landing lower than economists’ forecasts in a Reuters poll that expected a 4.50% increase.
The closely watched core index also slowed down at 4.26% from 4.45% in March and slightly below expectations of a 4.27% increase.
Mexico’s central bank, also known as Banxico, is scheduled to announce its monetary policy decision later on Thursday after an unexpected 25-basis-point cut in March that left its benchmark interest rate at 6.75%.
The market expects Banxico to end the monetary easing cycle that began over two years ago with a final 25-basis-point cut to the benchmark rate.
Despite de recent easing, inflation remains above the monetary institution target of 3%, plus or minus a percentage point.
(Reporting by Aida Pelaez-Fernandez and Ricardo Figueroa; Editing by Toby Chopra)
