CORRECTED-UPDATE 1-Mexico early-April inflation rises more than expected
(Corrects day in second paragraph to Wednesday) * Inflation picks up to 4.72 percent in year to mid-April * Above expectation for a 4.58 percent rise * Interest rate decision on Friday By Alexandra Alper MEXICO CITY, April 24 (Reuters) - Mexican inflation picked up more than expected in early April, marking its third straight month of gains and soaring higher above the central bank ceiling, crimping the central bank's ability to juice growth and rein in peso gains. Inflation rose to 4.72 percent in the year through the first half of April, the national statistics agency said on Wednesday, above expectations for a 4.58 percent pace in a Reuters poll and the 4.12 percent rate in the year through the end of March. Inflation has been on the upswing since February, which the central bank had expected. The uptick is due in part to a low base of comparison last year. April will mark a new methodology for calculating inflation that is expected to reduce the impact on the annual rate of a drop in electricity costs as summer subsidies kick in. Mexico's central bank cut its benchmark interest rate by 50 basis points to an all-time low of 4 percent in early March in a bid to tame foreign capital inflows and tamp down the appeal of the peso, which has gained almost 5 percent against the U.S. dollar this year. The central bank has said it expected inflation to be below 4.0 percent by the start of the second half of the year, and on a downwards path towards its 3.0 percent target by the end of 2013. Consumer prices fell 0.09 percent in the first half of April following a 0.52 percent rise notched in the first half of March, but the decrease was less than the 0.23 percent drop analysts had forecast. Core prices, which strip out volatile goods like energy and food, rose 0.05 percent, lower than the 0.26 percent in the first half of March and compared to an expected 0.09 percent. (Reporting by Alexandra Alper; Editing by Simon Gardner and James Dalgleish)
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