MEXICO CITY, Sept 24 (Reuters) – The Bank of Mexico on Thursday held its benchmark interest rate steady at 6.50% as expected, though it dropped guidance that explicitly suggested policymakers would continue to keep borrowing costs at that level going forward.
The five‑member board of Banxico, as the Mexican central bank is known, was unanimous in its decision.
Banxico said it would make future policy decisions by considering the ongoing disinflation process and the behavior of its determinants, including the exchange rate pass-through to consumer prices, the slack conditions and inflation expectations.
The new monetary policy statement omitted language from the previous three statements which said that going forward the board estimated it would be appropriate to maintain the key interest rate at current levels.
Banxico maintained its expectation that headline inflation will converge to its 3% target in the fourth quarter of 2027 and said the balance of risks for inflation remains biased to the upside.
The bank pointed to uncertainty stemming from US economic policy and geopolitical conflicts, while noting that economic slack is expected to continue throughout the forecast horizon and that downside risks to economic activity persist.
Economists polled by Reuters had widely expected the bank to keep rates on hold. The US Federal Reserve raised its benchmark interest rate by 25 basis points at its September meeting, but Banxico emphasized that Mexican monetary policy does not automatically need to follow the Fed’s moves.
(Reporting by Kylie Madry; Editing by Anthony Esposito)
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