(Bloomberg) -- Mexico's annual inflation slowed slightly less than expected in early December as the central bank extends its interest rate cuts.

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Official data released Monday showed consumer prices rose 4.44% in the first two weeks of December from a year prior, just above the 4.4% median estimate of economists surveyed by Bloomberg and down from the 4.55% reading in late November.

Core inflation, which is closely watched by the central bank and excludes volatile items such as food and fuel, accelerated to 3.62%, just above the 3.59% median estimate. The central bank, which holds its next rate-decision meeting Feb. 6, targets inflation of 3%, plus or minus 1 percentage point.

Banxico, as the central bank is known, lowered borrowing costs by a quarter-point to 10% in an unanimous decision last week with core inflation back in the target range and Latin America's No. 2 economy losing momentum.

Policymakers said they expect that the inflationary environment will allow further reductions. "In view of the progress on disinflation, larger downward adjustments could be considered in some meetings, albeit maintaining a restrictive stance," they wrote in a statement accompanying the decision.

Risks to that assessment were noted by Banxico's board. Potential trade policy shifts under incoming US President Donald Trump, who's threatened to impose 25% tariffs on all goods imported from Mexico, pose risks to both growth and consumer price forecasts.

The bank in its post-decision statement marked up consumer price forecasts from the second quarter of 2025. It now sees inflation converging to the 3% target in the third quarter of 2026 from the fourth quarter of 2025 previously.

Banxico in late November revised its 2024 GDP estimate up to 1.8%, but held the 2025 forecast at 1.2%, implying a fourth year of slowing growth.