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 Business News | November 2007 
Mexico Economists Raise 2008 Inflation Forecasts
 Patrick Harrington - Bloomberg
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Economists covering Mexico raised their forecasts for 2008 inflation while reducing their estimate for consumer price increases this year, according to a survey released by the Mexican central bank.
Economists expect inflation will be 3.72 percent next year, Banco de Mexico said today, citing the average projection of 35 analysts surveyed between Oct. 24 and Oct. 30. That compares with an estimate of 3.69 percent last month.
The Bank of Mexico polled the economists before policy makers raised their official inflation outlook yesterday. The bank cited new taxes backed by President Felipe Calderon and "persistently high" food prices on international markets.
Economists lowered their expectations for 2007 inflation to 3.76 percent from 3.81 percent. Analysts raised their estimates for 2007 core inflation, which excludes prices for energy and fresh food, to 3.71 percent from 3.69 percent.
In today's poll, economists raised their estimates for economic growth to 3.05 percent in 2007 from 2.98 percent and to 3.43 percent in 2008 from 3.39 percent.
Inflation will be at 3.54 percent at the end of 2009, the economists said.
Central bank policy makers said yesterday that they expect the inflation rate will probably climb to 4 percent to 4.5 percent during the second and third quarters of 2008. For the rest of 2007, they expect inflation to average 3.5 percent to 4 percent. The previous estimate was 3.25 percent to 3.75 percent.
Central bankers on Oct. 26 raised the benchmark lending rate a quarter percentage point to 7.50 percent and postponed by one year their goal of reaching 3 percent inflation until the end of 2009.
Central Bank Governor Guillermo Ortiz said yesterday during the bank's report that policy makers are "worried" that expectations for inflation are above their target.
To contact the reporter on this story: Patrick Harrington in Mexico City at Pharrington8@bloomberg.net |
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