In line with the market expectation, Mexico’s central bank, Banxico, announced its decision to keep the policy rate unchanged at 8.25%.
Key takeaways from the policy statement (via Reuters)
- Board was unanimous on rate decision.
- Will pay special attention to uncertainty, pass-through of exchange rate on prices, relative monetary policy between Fed and Mexico.
- Balance of risks for inflation has upward bias in an environment of marked uncertainty.
- Even if inflation has accelerated the board believes this is transitory and current monetary policy stance is consistent with convergence of inflation towards target on policy horizon.
- The balance of risks for growth has become more uncertain, continues to be tilted downwards.
- Looking forward risks persist that could have significant impact on performance of financial assets in Mexico.
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