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Mexican Customs will eliminate tariffs on 26 products

Mexican customs will eliminate tariffs on 26 products as a measure to reduce inflation in the country, the federal government reported.

The products are corn flour, wheat flour, white corn, sorghum, wheat, corn oil, palay rice, tuna, pork, chicken, beef, onion, jalapeño pepper, beans, eggs, soap, dresser, tomato, milk, lemon, apple, orange, box bread, potato, pasta for soup, sardine and carrot.

The measure has not yet entered into force, but it was already anticipated as part of the Package against inflation and famine (Pacic), which was announced this Wednesday.

The elimination of tariffs will last for six months

Mexican customs will eliminate tariffs on 26 products as a measure to reduce inflation in the country, the federal government reported.

According to preliminary figures, Mexico‘s economy expanded 4.8% in real terms in 2021, reflecting a gradual recovery in economic activity.

In turn, the National Consumer Price Index of Mexico grew 3.2% in 2020 and 7.4% in 2021.

Customs

On February 10, 2022, the Bank of Mexico held its first monetary policy meeting of 2022.

At the meeting, the Bank of Mexico increased the overnight interbank interest rate by 50 basis points, from 5.50% to 6.00 percent.

The decision took into account factors affecting inflation, risks to medium- and long-term expectations and price formation, and the current challenges of global economic and financial conditions.

Given the greater inflationary pressures, the forecasts for headline and core inflation were revised upwards for the entire horizon and it is now expected that convergence to the 3% target will be reached in the first quarter of 2024.

These forecasts are subject to risks. On the rise: persistence of core inflation at high levels; external inflationary pressures derived from the pandemic; greater pressure on agricultural and energy prices due to the recent geopolitical conflict; exchange depreciation; and cost pressures.

On the downside: a decrease in the intensity of the armed conflict; a larger than expected effect of the negative output gap; lower-than-expected energy prices; and currency appreciation.

The balance of risks regarding the forecast path for inflation in the forecast horizon has deteriorated and remains biased upwards.

Mexican customs are expected to put the tariff elimination into effect in the coming days.

 

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