This Report on the Observance of Standards and Codes (ROSC) Data Module provides an assessment of Mexico’s macroeconomic statistics against the Special Data Dissemination Standard (SDDS) complemented by an assessment of data quality based on the IMF’s Data Quality Assessment Framework (DQAF) 2012. Mexico’s Consumer Price Index (CPI) and Producer Price Index (PPI) have solid institutional, conceptual and methodological, and source data foundations achieved through implementation of international best practices. Implementation of good practice extends to the serviceability and dissemination aspects of both indexes. It is also observed that CPI and PPI both benefit from the application of sound practices in concepts and methods.

Abstract

This Report on the Observance of Standards and Codes (ROSC) Data Module provides an assessment of Mexico’s macroeconomic statistics against the Special Data Dissemination Standard (SDDS) complemented by an assessment of data quality based on the IMF’s Data Quality Assessment Framework (DQAF) 2012. Mexico’s Consumer Price Index (CPI) and Producer Price Index (PPI) have solid institutional, conceptual and methodological, and source data foundations achieved through implementation of international best practices. Implementation of good practice extends to the serviceability and dissemination aspects of both indexes. It is also observed that CPI and PPI both benefit from the application of sound practices in concepts and methods.

Overall Assessment

1. Mexico has been a subscriber of the Special Data Dissemination Standard (SDDS) since August 1996, posting its metadata on the Fund’s Dissemination Standards Bulletin Board (DSBB) in March 1998. Mexico is in observance of the SDDS, meeting the specifications for data coverage, periodicity and timeliness, and the dissemination of advance release calendars. Mexico avails itself of a flexibility option on the timeliness of general government or public sector operations. Appendix Table 4 provides an overview of Mexico’s dissemination practices compared with the SDDS. This Report on Observance of Standards and Codes—Data Module (data ROSC) focuses on the consumer price index (CPI) and the producer price index (PPI), complementing a 2010 data ROSC covering Mexico’s national accounts, government finance, monetary, and balance of payments statistics. This data ROSC is based on the 2012 version of the IMF’s Data Quality Assessment Framework (DQAF), which explicitly incorporates international standards updated since the July 2003 version on which the 2010 data ROSC was based. The relevant updates for this assessment are:

  • The Consumer Price Index Manual (CPI Manual) was published in 2004 by the Inter Secretariat Working Group on Price Statistics,1 updating previous guidance from the International Labor Organization of 1983.

  • The Producer Price Index Manual (PPI Manual) was published in 2004 by the Inter Secretariat Working Group on Price Statistics.

  • The System of National Accounts was updated from its 1993 version (1993 SNA) to 2008 version (2008 SNA).

2. This data ROSC contains the following main observations. Mexico’s CPI and PPI have solid institutional, conceptual and methodological, and source data foundations achieved through implementation of international best practices. Implementation of good practice extends to the serviceability and dissemination aspects of both indexes. Responsibility for compiling and releasing the CPI and PPI were transferred from the Bank of Mexico (BM) to the National Institute of Statistics and Geography (INEGI) in July 2011. This evaluation found the collaboration between the BM and INEGI in the transfer of these two key economic indicators exceptionally successful in view of the improvements concurrently implemented in both the CPI and PPI with the move. A new total quality management system was implemented at INEGI, a new Technical Committee Specializing in Price Statistics (TCSPS) was organized to obtain feedback from user groups, a new system for analysis of the index series was developed, and improvements were made for several important CPI modules such as mobile telephone service, automobile purchase, electricity, gas, and computers.

3. In applying the IMF’s DQAF, the remainder of this section presents the mission’s main conclusions. The presentation is done at the level of the DQAF’s quality dimensions, by agency (INEGI) for the first two dimensions and across datasets for the remaining four.

4. The CPI and PPI are produced by INEGI under a strong legal and institutional environment preserving the professional independence of, and providing adequate resources for, statistical compilations. The National System of Statistical and Geographical Information Law places INEGI at the center of the statistical system and gives it substantial autonomy in the statistical sphere.

5. The CPI and PPI both benefit from the application of sound practices in concepts and methods. The CPI has commendable coverage of expenditure, including both equivalent rent of owner-occupied dwellings and employer-provided goods as compensation in-kind. The PPI’s product indices have a commendably broad coverage of industrial activities comprising 80 percent of total output; however, industry price indexes inclusive of the secondary products of each industry are not available.

6. The price surveys of both indices are well designed and carefully implemented, following systematic quality assurance practices. The household expenditure data underlying the CPI’s weights need to cover a full year rather than the current three months so that the weights cover a full seasonal cycle. INEGI has begun a continuous household expenditure survey that will supply such information in the future. The PPI weights derive directly from the national accounts supply and use system. Index quality adjustment methodology in both index programs is strong. Both index programs conduct studies of the impacts of weight, methodology, and source data revisions.

7. Both indexes exceed SDDS periodicity and timeliness requirements. The set index revision policy is every four years for the CPI, with weight updates at a more frequent two year interval, and every five years for the PPI, consistent with international good practice. Data are monitored for consistency over time and with other comparable price indicators. Revision policy is clear and public for current revisions to both indexes—up to four months for the PPI—as well as major revisions including to scope, methodology, weights, and baskets. The CPI is internally consistent in aggregation by product/expenditure category and geographic area. Both indexes are available at high levels of detail.

8. Accessibility to users is very good. Data are published in several formats and are available in detail. Detailed and summary methodology documents are available for both indexes. INEGI provides quick and reliable service to index users who have questions, or who need publications or further information on the index, via telephone, through its sales centers, and through its website, including an online chat facility. The INEGI website allows the user to create and download tables and graphs with virtually any format using the data available on the website.

9. Section II provides a summary assessment by agency and dataset based on a four-part scale. This is followed by staff recommendations in Section III. Practices compared to the SDDS are summarized in Appendix I. The authorities’ response to this report and a volume of detailed assessments are presented in separate documents.

Assessment by Agency and Dataset

10. Assessment of the quality of two macroeconomic datasets—CPI and PPI statistics—were conducted using the DQAF. In this section, the results are presented at the level of the DQAF elements and using a four-point rating scale (Table 1). Assessments of the prerequisites of data quality and the assurances of integrity (Dimensions “0” and “1” of the DQAF) are presented in Table 2. For each dataset, the assessment of methodological soundness, accuracy and reliability, serviceability, and accessibility (Dimensions “2” to “5” of the DQAF) are shown in Tables 3a and b.

Table 1.

Data Quality Assessment Framework 2012—Summary Results

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Practice observed: Current practices generally meet or achieve the objectives of DQAF internationally accepted statistical practices without any significant deficiencies. Practice largely observed: Some departures, but these are not seen as sufficient to raise doubts about the authorities’ ability to observe the DQAF practices. Practice largely not observed: Significant departures and the authorities will need to take significant action to achieve observance. Practice not observed: Most DQAF practices are not met. Not applicable: Used only exceptionally when statistical practices do not apply to a Mexico’s circumstances.
Table 2.

Assessment of Data Quality—Dimensions 0 and 1—National Institute of Statistics and Geography (INEGI)

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Table 3a.

Assessment of Data Quality—Dimensions 2 to 5—Consumer Price Index (CPI)

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Table 3b.

Assessment of Data Quality—Dimensions 2 to 5—Producer Price Index (PPI)

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Staff’s Recommendations

11. Based on the review of Mexico’s statistical practices, discussions with the data producing agencies, and responses from data users, the mission has developed a set of recommendations. They are designed to increase further Mexico’s adherence to internationally accepted statistical practices and would, in the mission’s view, enhance the analytical usefulness of Mexico’s statistics.

Consumer price index

  • The CPI weights should be based on survey data (among other sources) covering a full seasonal (annual) cycle; forthcoming continuous household expenditure survey data can be used to compile these weights.

  • Research the impact of covering rural and small urban areas, with population less than 15,000, near urban clusters already in the area sample.

Producer price index

  • Compile a set of PPIs by economic activity including secondary products.

Appendix Table.

Practices Compared to the SDDS Coverage, Periodicity, and Timeliness of Data

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Note: Periodicity and timeliness: (D) daily; (W) weekly or with a lag of no more than one week from the reference data or the closing of the reference week; (M) monthly or with a lag of no more than one month; (Q) quarterly or with a lag of no more than one quarter; (A) annually; and (…) not applicable.Italics indicate encouraged categories.
1

The membership of the IWGPS comprises Eurostat, International Labor Organization (ILO), IMF, Organization for Economic Cooperation and Development (OECD), and United Nations Economic Commission for Europe (UNECE).

Mexico: Report on the Observance of Standards and Codes—Data Module
Author: International Monetary Fund. Statistics Dept.