Overview and Context
Mexico’s consumer inflation reported a deceleration at the end of last year, placing it within the Banco de Mexico’s (Banxico) target range. This marked the lowest annual price increase for a December since 2020, according to data released by Mexico’s National Institute of Statistics and Geography (Inegi).
Monthly and Annual Inflation Figures
The National Consumer Price Index (INPC) reported a monthly variation of 0.28% by the end of 2025, resulting in an annual inflation rate of 3.69%. This is lower than the previous month’s figure of 3.80%.
As a result, 2025 concluded with the lowest December inflation since 2020, when the Covid-19 pandemic and supply chain disruptions led to an inflation rate of 3.15%. The inflation data surprised the market, as analysts expected an inflation rate of 3.80% in December.
The annual inflation rate stayed within Banxico’s target range of 3% ±1 percentage point, though some institutions believe there is still a long way to go before reaching the precise 3% level.
Subyacente Inflation Continues to Pressure Consumers
According to Inegi’s report, the subyacente inflation—which excludes more volatile goods and services—also slowed down in December but continued to put pressure on Mexican families’ budgets.
In December, the subyacente index stood at 4.33% annually, down from 4.43% in November. Within this category, goods saw a higher inflation rate of 4.35% annually, while services increased by 4.30%.
On the non-subyacente side, December’s inflation rate was 1.61% annually, lower than November’s 1.73%. Among these factors, the price of agricultural products rose by only 0.88% annually in December, while energy prices and government tariffs increased by 2.19%.
Key Products Driving Inflation
By incident, or contribution to the overall inflation rate, the following products had the most significant monthly price increases in December:
- Airline transportation 19.89%
- Street food vendors (loncherías, fondas, torterías y taquerías) 0.83%
- Green tomatoes 27.01%
- Owner-occupied housing 0.18%
- Pasteurized and fresh milk 1.54%
- Restaurants and similar establishments 0.45%
- Bottled carbonated beverages 1.0%
- Table wine 4.80%
- Packaged tourism services 5.23%
- Foreign bus service 2.14%
Products with Decreasing Prices Offering Relief
Meanwhile, the following products with decreasing prices provided some relief:
- Eggs -4.11%
- Chicken -1.30%
- Zucchini -8.38%
- Papaya -10.77%
- Detergents -1.19%
- Serrano chili peppers -6.90%
- Hair care products -1.35%
- Other vegetables and legumes -3.64%
- Bananas -4.16%
- Potatoes and other tubers -2.69%
Key Questions and Answers
- What is the current inflation rate in Mexico? The consumer inflation rate in Mexico slowed to 3.69% in December, the lowest annual increase since December 2020.
- How did the subyacente inflation perform in December? The subyacente inflation also decelerated to 4.33% annually in December, though it continued to pressure consumers.
- Which products had the most significant price increases in December? Airline transportation, street food vendors, green tomatoes, owner-occupied housing, pasteurized and fresh milk, restaurants and similar establishments, bottled carbonated beverages, table wine, packaged tourism services, and foreign bus service all saw notable price increases.
- Which products experienced price decreases in December, offering relief to consumers? Eggs, chicken, zucchini, papaya, detergents, serrano chili peppers, hair care products, other vegetables and legumes, bananas, and potatoes and other tubers all had decreasing prices.
