The central bank aims for a 3 percent inflation rate with a margin of error of one percentage point. Inflation in Mexico: Which products rose the most in price in March 2026? Tomatoes, plane tickets, as well as bars, restaurants, taco and cake stands, recorded the highest price increases in March, while internet, phone, and TV packages, eggs, and pork experienced the largest price reductions. Amid concerns about the weakening economy and rising inflationary pressures, the central bank resumed its monetary easing cycle at its March 26 meeting, following the February pause. Three members of the board, including Governor Victoria Rodríguez, supported a quarter-point cut to 6.75 percent, while two voted to keep the rate at 7 percent for a second consecutive meeting. Banxico, as the bank is known, said it is considering an additional interest rate cut at an unspecified time while closely monitoring inflation and the evolution of external factors that could influence future decisions, according to the post-decision communiqué. Policymakers also revised their inflation forecasts for the first three quarters of 2026 upward, while maintaining the guidance that inflation will converge to the target in the second quarter of 2027. While the war in Iran has increased inflationary pressures with rising crude oil prices, Banxico noted that the conflict poses a downside risk to the local economy. Mexico's annual inflation accelerated in March after Banxico resumed its monetary easing cycle and raised its inflation forecasts, due to the war with Iran putting pressure on global energy prices. According to the National Institute of Statistics, consumer prices rose 4.59 percent in March compared to the same month last year. This figure was below the analysts' average estimate of 4.64 percent polled by Bloomberg but above the 4.02 percent recorded in February. Underlying inflation, which excludes volatile food and fuel prices and is closely watched by the central bank, slowed to 4.45 percent year-on-year from 4.50 percent in February and below the average estimate of 4.47 percent.
