Mexico inflation jumps to 10-month high in early February

Mexican consumer prices rose more than expected in early February to their highest since last April on a surge in food costs, but core inflation showed only modest pressure from a deep slump in the peso.

Inflation in the 12 months through mid-February MXCPHI=ECI was 2.94 percent, higher than a forecast 2.86 percent rate in a Reuters poll and up from 2.75 percent in the second half of January. This was the second monthly increase in a row.

Mexican full-month inflation hit successive record lows from May through December, but the annual pace of price gains began to rise in January. The central bank expects inflation to remain around its 3 percent target this year.

Last week, the central bank hiked its main interest rate by a half-percentage point to 3.75 percent to support the peso, and policymakers said they could act again to keep big currency losses from fanning consumer prices higher.

Consumer prices rose 0.29 percent in the first half of February MXCPIF=ECI, above an expected 0.20 percent, on higher egg, onion and chili pepper prices.

The core index MXCPIH=ECI, which strips out some volatile food and energy prices, rose 0.23 percent, in line with expectations.

The 12-month core inflation rate MXCPIC=ECI rose 2.62 percent, just below the poll's expectations of 2.63 percent and below 2.68 percent in the second half of January, underscoring the lack of pressure from the weak peso.