Key facts
- Mexico's annual inflation rate decelerated to 3.94% in May, down from 4.45% in April.
- The May inflation rate falls within the central bank's target range of 3% +/- 1 percentage point.
- Monthly consumer prices decreased by 0.21% in May, the first monthly fall in two years.
- The core inflation index's annual rate slowed to 4.19% in May from 4.26% in April.
- Mexico's central bank cut its benchmark interest rate by 25 basis points to 6.50% in early May.
Mexico's annual inflation rate decelerated for a second consecutive month in May, officially returning to the higher end of the central bank's target range. Consumer prices rose 3.94% year-on-year, easing from April's 4.45% and falling below economists' forecasts of 4.03%. The monthly consumer price index saw a larger-than-expected decline of 0.21% compared to the previous month. The core inflation index, which excludes volatile food and energy prices, slowed to 4.19% annually from 4.26% in April. Mexico's central bank, Banxico, targets an inflation rate of 3% with a one percentage point tolerance and expects to reach it in the second quarter of 2027. The institution ended its monetary easing cycle in early May, lowering its benchmark interest rate by 25 basis points to 6.50% in a divided decision.