March 22, 2013 / 2:45 PM / 5 years ago

UPDATE 2-Mexico inflation jumps in early March

* Inflation picks up to 4.12 pct in year to mid-March

* Unemployment rate falls to 4.76 pct in Feb

MEXICO CITY, March 22 (Reuters) - Mexican inflation picked up more than expected in early March, overshooting the central bank’s ceiling just weeks after an interest rate cut in Latin America’s No. 2 economy, but economists said the rise would be temporary.

Inflation accelerated to 4.12 percent in the year through the first half of March, the national statistics agency said on Friday, above expectations for 3.8 percent in a Reuters poll and a 3.55 percent rate in the year through the end of February.

Banco de Mexico surprised investors earlier this month when it cut the benchmark interest rate to a record low of 4 percent despite an uptick in consumer prices in February.

The central bank had said it expected inflation to accelerate around the end of the first quarter and the start of the second, due in part to low inflation rates early last year, before cooling to near its 3 percent target by end-2013.

“It’s a temporary pick-up and perfectly anticipated by the monetary authority,” said Santander economist Rafael Camarena.

“(Inflation) will remain above 4 percent in March, April and May. Possibly by June we will start to see a decline.”

The Banco de Mexico has a tolerance zone for inflation of one percentage point each side of the target.

Consumer prices rose 0.52 percent in the first half of March, above the 0.24 percent notched in the first half of February and well above the 0.18 percent rise analysts had forecast.

Core prices, which strip out volatile goods like energy and food, rose 0.26 percent, slightly higher than the 0.24 percent in the first half of February and compared to an expected 0.18 percent.

The acceleration was driven by a sharp jump in fruit and vegetable prices, particularly red and green tomatoes, while energy prices also rose.

Annual inflation in services, a key gauge of home-grown price pressures, accelerated and non-food core goods inflation, the most sensitive to currency fluctuations, was steady.

Camarena said the stronger peso, which has appreciated more than 3 percent this month, would help bring inflation down by making imported goods cheaper.

Separate data showed unemployment was better than expected in February. Mexico’s seasonally adjusted jobless rate fell to 4.76 percent, the national statistics agency said, below expectations for a 5.16 percent rate.

Unemployment has fallen back from rates near 6 percent seen during a deep recession in 2009 but had crept up in recent months as the global slowdown weighed.

The headline unadjusted jobless rate was 4.85 percent last month, below an expected 5.2 percent.

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