Mexico shocks with 50bp cut

Mexico shocks with 50bp cut

Economy & Policy

Mexico’s central bank surprised the market with a 50bp cut in its base rates to a historic low of 3% on Friday. Consensus opinion was that the central bank would keep rates on hold at 3.5%. The bank’s forward guidance suggested no further cuts, but also acknowledged weaker-than-expected growth in the first quarter of the year. The central bank was being “a lot more realistic” on the local economy, said Goldman Sachs analysts, calling the hike “positive and warranted, and therefore credibility-bu

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