Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/83770
Authors: 
Ysusi, Carla
Year of Publication: 
2009
Series/Report no.: 
Working Papers, Banco de México 2009-09
Abstract: 
This paper studies the dynamics of Mexican inflation by using a wavelet multiresolution analysis on 16 indexes of the Mexican Consumer Price Index. This enables us to estimate the long-term trend, seasonality, and local shocks of the inflation series, even when the series are non-stationary. The energy distribution between the high frequency, seasonal, and trend components, as well as its evolution through time, are compared. In particular, headline and core inflations show a more stable behavior in all the scales since 2001. Also, an increase in the proportion of variance explained by short-term variations is detected in the inflation series. In relative terms, the short run is becoming as important for headline inflation as the medium and long run, and more important for non-core inflation. These results are in line with previous studies documenting the reduction in the Mexican inflation persistence.
Subjects: 
inflation dynamics
wavelets
multiresolution analysis
energy decomposition
JEL: 
C19
C49
E31
Document Type: 
Working Paper
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