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Mexico raised borrowing costs to a record 10% after a key measure of inflation accelerated again last month and to keep pace with the US Federal Reserve’s most aggressive tightening campaign in decades.
Banxico, as the central bank led by Governor Victoria Rodriguez is known, delivered a fourth straight interest rate increase of 75 basis points, it said in a statement Thursday, as forecast by all 26 economists surveyed by Bloomberg. The decision was split, with Deputy Governor Gerardo Esquivel dissenting from the other four board members and backing a half-point hike.
Mexican President Andres Manuel Lopez Obrador said the Mexican peso's strength is good for the economy but warned, hours before the central bank announces its monetary policy decision, that rising interest rates can hurt the economy.
The bank blamed the lingering effects of the pandemic and Russia's invasion of Ukraine for high prices.
It said inflation would hit the three percent objective in the "third quarter of 2024".
Banxico, as the central bank led by Governor Victoria Rodriguez is known, delivered a fourth straight interest rate increase of 75 basis points, it said in a statement Thursday, as forecast by all 26 economists surveyed by Bloomberg. The decision was split, with Deputy Governor Gerardo Esquivel dissenting from the other four board members and backing a half-point hike.
Mexico Raises Rate to 10% on Faster Core Inflation, Matching Fed
www.bloomberg.com
Mexican President Andres Manuel Lopez Obrador said the Mexican peso's strength is good for the economy but warned, hours before the central bank announces its monetary policy decision, that rising interest rates can hurt the economy.
The bank blamed the lingering effects of the pandemic and Russia's invasion of Ukraine for high prices.
It said inflation would hit the three percent objective in the "third quarter of 2024".
