Inflation and consumer price indexes in Mexico - Statistics & Facts

Global events from 2020 to 2022 had considerable effects on the Mexican economy. Inflation and rising prices are constantly pressuring families' budgets and raising concerns about increasing poverty and inequality. The inflation rate in Mexico has soared from 3.4 percent in 2020 to a forecast of 7.9 percent in 2022, the highest figure of the last 22 years. The high rates over the past three years created a problem when buying the most basic goods and services, like food, electricity, or water, due to decreasing purchasing power. In fact, the product category with the highest inflation rate in the last year was food, beverages, and tobacco.

How is inflation in Mexico measured?

There are many indexes to measure price changes, the National Institute of Statistics, Geography, and Informatics (INEGI) use the Consumer Prices Index (CPI), which considers 299 goods and services of the basic basket in rural and urban areas. This index represents the costs that the average consumer faces. Besides, the CPI presents figures about different categories, products, services, or distinct geographical areas, which allows the index to have a more realistic approximation of how prices affect specific population sectors. However, other indexes like the Producer Price Index (PPI) offer a more business-oriented look at the prices of products or raw materials received by firms and manufacturers. The PPI is often referred to as the CPI predictor since raising cost reaches producers first, and then the increases are transferred to end users.

The most affected sector

Inflation does not hit everyone equally, for example, the CPI experienced in the city of Jacona, Michoacán was the highest among all cities in the country, registering a 6.27 percent increase in one year, an index over 45 percent higher than the Mexican average. Similar things happen when you compare different situations. For instance, the expense distribution varies from income brackets expecting the lower earnings levels to spend most of their disposable income on subsistence goods and services, like food, housing, and clothing. As a consequence, the impact of inflation for low-income families was significantly higher than for the middle and upper classes. Concretely, in 2022 households with revenues lower than 3,000 Mexican pesos per month had an inflation rate of the basic basket of 10.23 percent –namely, that prices were around 27 percent higher than for high-income families. The situation constitutes a bigger problem for society when the most vulnerable sector is the most affected. Besides, the exposure to a continuously high rate would bring exponential increases in poverty, informality, and unemployment.

Government response

With the intention to cope with rising prices, the Mexican government issued the “Plan against Inflation and Shortages” during the first half of July 2022. Some of the main proposed actions to avoid higher vulnerability rates among the residents are subsidizing gas and energy, increasing the production of critical agricultural goods (beans, corn, and rice), and lowering or removing fares for import products related to fertilizers. The Ministry of Finance and Public Credit estimates a 430 billion Mexican pesos investment during 2022 to keep gas prices down and 70 billion MXP each for food security and electricity. Some of the measures seem to have a positive effect, for example, the CPI of beans and rice even depicted decreasing prices year-over-year during some months of 2022. In contrast, other consumer products derived from these agricultural goods experienced high rates, like tortillas, an essential food of the Mexican diet that reached a 16.85 percent increase in one year. During the first half of 2023, the CPI started to decline, still with price increases reaching over 10 percent in the case of tortillas.
This text provides general information. Statista assumes no liability for the information given being complete or correct. Due to varying update cycles, statistics can display more up-to-date data than referenced in the text.
Published by Statista Research Department, Dec 1, 2023

Key insights

Inflation rate in 2022
7.9%
Share of people perceiving higher prices while grocery shopping
67%
Share of people that had to replace products with cheaper alternatives
66%
Get more insights

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