Mexico | Inflation is a problem. Controlling prices is not the solution

Summary

Inflation in Mexico during the first half of April reached a level of 7.7% while core inflation also registered a very high 7.2%. Both figures are the highest since January 2001.

Key points

• Key points:
• This is not an idiosyncratic phenomenon: we are seeing high inflation in most countries in the world.
• Inflation in the United States hit 8.5% in March, its highest level since 1981, and the International Monetary Fund (IMF) forecasts global inflation to be 7.4% this year.
• In the case of our country, the high inflation is not due to aggregate demand pressures, but to shocks from abroad, largely associated with the pandemic.
• The high inflation is worrying above all because it affects more the population with lower incomes.

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