MEXICO CITY: Annual inflation in Mexico accelerated in March to its highest level in more than seven and a half years amid a jump in the prices of some fruit and vegetables, and following a surge in gasoline costs at the start of 2017, data showed on Friday. Consumer prices rose by 5.35 percent in the year through March, according to the national statistics agency. That inflation rate was just above the consensus forecast of 5.32 percent of analysts polled by Reuters. Annual inflation was the highest since July 2009, and accelerated from 4.86 percent in February, the data showed.
Mexico’s government ushered in a sharp increase in gasoline prices in January, that pushed inflation above the central bank’s 4 percent tolerance ceiling that month. Stemming from a liberalization of price-setting, the gas price increase and a steep depreciation in the peso last year helped fuel expectations for higher inflation in 2017. Nevertheless, the peso has strengthened more than ten percent against the dollar this year, and gasoline prices were down slightly in March compared to February, the data showed. Foremost in the items pushing up the price index were green tomatoes, which were nearly 54 percent dearer in March compared to February, and limes, which were 33.7 percent more expensive. The cost of red tomatoes increased nearly 13 percent, and that of avocados rose by more than 15 percent, the data showed. Compared with February, Mexican consumer prices rose 0.61 percent overall, the data showed. The core price index, which strips out some volatile food and energy costs, rose by 0.57 percent during the month . Core annual inflation was 4.48 percent in March.
