Bank of Mexico increases interest rates to 4.25 %
The decision was made with the objective of slowing down inflation, which stood at 6.02 % in the first half of June
Most of the members of the Governing Board of Bank of Mexico(Banxico) resolved to increase interest rates by 25 basis points, to stand at 4.25 %.
With this decision, the financial entity aspires to slow down inflation, which stood at 6.02 % during the first half of June. Headline inflation is projected to approach the 3 % target in the third quarter of 2022.
The Bank informed, through a statement, that the next decisions on monetary policy will be related to the behavior of the factors that impact inflation, their expected trajectories in the forecast horizon and their expectations.
According to the information, the projections are subject to upside risks: persistence of underlying inflation or scenarios of exchange rate depreciation; or downward, greater measures of social distancing or exchange rate appreciation.
“The Governing Board will take thenecessary actions based on the additional information, so that the reference rate is consistent with the orderly and sustained convergence of general inflation to the target of 3 % in the term in which the company operates. monetary policy,” said the agency.
The bank also indicated that the Mexican economy registered during the month of March “a significant rebound” and some moderation in April. It is estimated that for the rest of the year economic activity will resume its recovery path, with a balanced balance of risks, although with “marked differences” between sectors.
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