Mexico’s inflation surges

Mexico’s inflation has surged and is currently running at a seven-year high at 6.2 percent.

The Mexican central bank has announced that it is the rising cost of both food and energy prices that has caused inflation to rise too quickly in the first two weeks of November.

Consumer prices for the period are expected to increase more than estimated so that annual inflation is likely to breakthrough the bank’s target for the final quarter.

Consumer prices have increased by 0.94 percent in the first 15 days of November compared to last month, even though the price of oil has meant inflation has been falling in the developed economies, it has yet to translate to the Mexican economy who are not such heavily-dependent oil consumers.

Estimates indicate that inflation will recede and close under 6 percent by the end of the year and it is hoped that inflation will be under 4 percent or lower by 2009.

The Mexican economy has been hit hard by the current global economic crisis, with the peso losing more than 30 percent of its value in the month of August.

The peso is currently trading at 13.5 against the dollar, with Mexico’s benchmark IPC index up more than 5 percent to 19,184.

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