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UPDATE 1-Mexico inflation highest since 2014 in November; rate hike seen
December 8, 2016 / 3:59 PM / 10 months ago

UPDATE 1-Mexico inflation highest since 2014 in November; rate hike seen

(Recasts with context and details)
    MEXICO CITY, Dec 8 (Reuters) - Mexico's annual inflation
reached its highest in two years in November, and the data
supported economists' expectations that the central bank will
raise interest rates again to offset a weaker peso. 
    Consumer prices jumped 3.31 percent since
November 2015, national statistics agency INEGI said on
Thursday. This was the highest since December 2014 and in line
with the 3.32 percent that analysts estimated in a Reuters poll.
    Last month Mexico's central bank raised interest rates for
the fourth time this year, to 5.25 percent for the main rate,
after the peso slumped on Donald Trump's win in the U.S.
presidential election.  
    Mexican policymakers have been concerned that the weak peso
was driving up inflation. If the U.S. Federal Reserve raises
rates next week, Mexico's central bank is widely expected to
follow suit in its last monetary policy meeting of the year on
Dec. 15.
    In a Reuters poll, more than 100 economists forecast that
the U.S. Federal Reserve would raise rates at its meeting next
week. 
    Goldman Sachs said in a Thursday research note that Mexico's
central bank was likely to raise interest rates by 25 to 50
basis points following the Fed decision if the peso remains
weak. Other economists share that view.
    Monthly inflation rose 0.78 percent in November
on surging electricity prices, according to non-seasonally
adjusted figures. 
     The core index, which strips out some volatile food and
energy prices, gained 0.22 percent during the month
.

 (Reporting by Joanna Zuckerman Bernstein; Additional reporting
by Michael O'Boyle and Miguel Angel Gutierrez; Editing by Lisa
Von Ahn)

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