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Mexican inflation seen holding steady in October - Reuters poll

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By Reuters
Mexican inflation seen holding steady in October - Reuters poll
FILE PHOTO: Tomatoes and chayotes are pictured at a groceries stall at a market in Mexico City, Mexico, January 11, 2017. REUTERS/Tomas Bravo   -   Copyright  Tomas Bravo(Reuters)

MEXICOCITY (Reuters) – Mexico’s annual inflation likely remained stable in October at the central bank’s target rate, reinforcing expectations of another interest rate cut by the Bank of Mexico when it meets later this month, a Reuters poll showed on Monday.

The median forecast of 12 banks, brokerages and analysts surveyed for the poll was for annual inflation at 3.0% in October, unchanged from September.

Compared with the previous month, consumer prices were expected to have risen by 0.53%, while the core index was forecast to climb by 0.25%, the survey showed.

At the end of September, the Bank of Mexico cut its main lending rate for the second meeting in succession, pointing to slowing inflation and weak economic growth.

Economic activity has remained weak in Mexico, encouraging the belief that the bank will cut rates again when it holds its next monetary policy meeting on Nov. 14.

The bank targets a rate of 3%, with a one percentage point tolerance threshold above or below that figure.

The annual core inflation rate is expected to slow for the fourth consecutive month, taking it to a level of 3.69%.

National statistics agency INEGI is due to publish the latest inflation data on Thursday at 0600 local time.

(Reporting by Noe Torres and Miguel Angel Gutierrez; Editing by Chizu Nomiyama)