Inflation eased in October compared to the previous month but remains well above the rate targeted by the Bank of México (Banxico), which is widely expect to lift its benchmark interest rate by 75 basis points on Thursday.

The national statistics agency INEGI reported Wednesday that the annual inflation rate was 8.41% in October, down from 8.7% in September. The October figure was slightly lower than the average 8.46% expectation of economists polled by the news agency Reuters.

Consumer prices were 0.57% higher last month than in September, INEGI said. The annual core inflation rate, which strips out volatile food and energy prices, reached a 22-year-high of 8.42% in October, up from 8.28% in September.

Data indicates that headline inflation – which was also 8.7% in August – may have peaked, but core inflation remains, for now, on an upward trajectory.

“Core inflation remains stubbornly sticky,” said Andrés Abadía, chief Latin America economist at economic research consultancy Pantheon Macroeconomics. “This, and still-rising [core] inflation expectations will push Banxico to hike … the main rate by 75 basis points.”

The central bank, which targets inflation of 3% with tolerance of 1% in both directions, has lifted its key rate by 0.75% after its three most recent monetary policy meetings, following the lead of the United States Federal Reserve on each occasion. Another hike of the same size on Thursday – the Fed hiked rates 0.75% last week – will lift the benchmark interest rate to 10%. The current 9.25% rate is already the highest since the central bank introduced a new monetary policy regime in 2008.

The federal government has also been trying to suppress inflation by continuing to subsidize fuel and devising a purported inflation-busting plan in conjunction with the private sector. The plan was strengthened last month, after data showed that prices for many basic foodstuffs were still increasing.

Data published by INEGI on Wednesday showed that fruit and vegetables were 12.63% more expensive in October than a year earlier, meat prices were up 15.61%, non-food goods cost 8.03% more, services were 5.3% dearer, energy (including) electricity was 3.77% more costly and housing expenses rose 3.14%.

With reports from Bloomberg Línea, El Financiero, El Economista and Reuters