La Jornada: The worst of the food hikes is over: Citi México

The strongest increase in the prices of essential products, such as fruits and vegetables, is already behind us, estimated Julio Ruiz, chief economist at Citi Mexico.

Although in the coming months there may be increases in some products due to unexpected factors such as droughts, these will not be of the same magnitude as those observed in March, which was “a complicated month,” said the specialist.

“Commodities have already reached the historical average as a whole, that is, they have already peaked. Perhaps some could rise again, which is difficult to predict because droughts, for example, cannot be anticipated. But we believe that we should not see increases of the same magnitude as those in March.

“In the volatile part of fruits and vegetables, and assuming that there are no second-order effects due to the conflict in the Middle East, everything indicates that the worst has already passed, even in some basic products. In the future there could be additional increases, but they would be minor and not generalized,” Ruiz said in a conference.

At the end of March, inflation stood at 4.59 percent, its highest level since October 2024, as a result of an increase in the prices of fruits and vegetables, according to information from the National Institute of Statistics and Geography.

One of the products that became most expensive was tomatoes. According to the Agricultural Market Consulting Group (GCMA), the kilo of this input for the final consumer increased 12 pesos during the reference month.

The increase in basic products such as tomatoes, chilies, lemons and onions, said the National Union of Agricultural Workers (UNTA), was the result of the increase in the prices of fuel, logistics and fertilizers. Experts pointed out that these movements also respond to seasonal factors and the volatility of agricultural products, whose prices usually rise or fall in short periods, depending on climatic and supply conditions.

Julio Ruiz explained that the conflict in the Middle East has not had a general impact on inflation in Mexico, since the increases observed in fresh food respond to internal factors.

“The increases we have seen, especially in fruits and vegetables, are not related to the geopolitical conflict. They are more internal factors, such as production issues or drought. For now we do not see a generalized impact on prices due to this conflict; we would have to start worrying if it were transferred to more products,” he explained.

On the other hand, the Citi Mexico economist considered that this year the Bank of Mexico (BdeM) will not deliver remnants of its operations to the federal government, due to the appreciation of the Mexican peso against the US dollar since the end of 2025.

The central bank does not make profits by not being a private financial intermediary; However, it obtains resources from exchange operations in the market. If the peso appreciates against the dollar, the operations give a negative balance, but if it depreciates, it generates remainders.

These resources are delivered to the federal government. Last year, for the first time since 2016, the central institute delivered to the federal government about 17,994.8 million pesos, corresponding to the fiscal year 2024.