The state of Oaxaca began 2025 as the second most expensive state in the country, registering a 4.67% price increase in January, according to the National Consumer Price Index (INPC) published this Monday by INEGI (the National Institute of Statistics and Geography). Only Quintana Roo, with a 4.98% increase, surpasses Oaxaca and is the most expensive state in the country.
The analysis of INEGI statistics reveals that Oaxaca has experienced six consecutive months of inflation above 4%, far exceeding the Bank of Mexico’s target of between 3.8% and 3.5% for 2026. The rampant increase in the prices of goods, services, and basic necessities led Oaxaca to close 2025 with a 4.39% increase, significantly higher than the national average of 3.69%.
Last year, Oaxaca’s inflation rate exceeded the national average by 0.70 percentage points. This first month of the year, the cost of living in the state is 0.88 percentage points higher than the national average.
Education, the increase in the soft drink tax, and the adjustment to tax rates and the cost of goods and services provided by the government have been the main factors impacting the finances of Oaxacans.
In January 2026, the national Consumer Price Index (CPI) reached 143.588, an increase of 0.38% compared to the previous month. With this result, the annual inflation rate was 3.79%. In the same month of 2025, the monthly inflation rate was 0.29%, and the annual rate was 3.59%.
The gentrification of Oaxaca City continues to be the primary cause of the high cost of living in the metropolitan area, the Central Valleys region, and surrounding municipalities. Oaxaca City reported a general price increase of 4.87%, far exceeding the other urban areas and even the metropolitan area of Santo Domingo Tehuantepec, which reported a price increase of 3.88%, ranking 18th out of the 55 cities considered by INEGI (the National Institute of Statistics and Geography) for the National Consumer Price Index (INPC).
Nationally, INEGI points to the following factors as contributing to this high cost of living: government-authorized tariffs increased by 5.85%; food, beverages, and tobacco rose by 6.15%, although the main driver of the increase was the rise in the tax on soft drinks.
The increase in soft drink prices is due to the adjustment of the Special Tax on Production and Services (IEPS), which went from $1.64 to $3.08 pesos per liter. Even national media outlets and reported on the price increases for sugary drinks since last December.
Inflation in Mexico accelerated during January, supporting the Bank of Mexico’s (Banxico) decision to halt the cycle of interest rate cuts, which began almost two years ago, and to raise its inflation forecasts for the coming months.
According to data from the National Institute of Statistics and Geography (Inegi), consumer prices rose 3.79 percent year-on-year in January, higher than the 3.69 percent recorded in December.
Nationwide, in January, the largest price increases were seen in cigarettes, bottled soft drinks, coffee shops, informal restaurants, bakeries, and taco stands. In contrast, air transportation, eggs, and domestic LP gas saw price decreases.
Source: imparcialoaxaca
