Banixco leaves opening for future rate cuts

Banixco leaves opening for future rate cuts

Capital Markets Corporate & Sovereign Strategy Regulation Economy & Policy Mexico

Mexico's central bank, Banco de México, also known as Banxico, left the door open for future interest rate cuts at its last monetary policy meeting in December, although it decided at the time to hold the benchmark rate at 4.25%. Two members of the five-person committee favored cutting the rate to 4%, arguing that the fragile economic recovery required a more aggressive monetary policy as inflation declined near the end of 2020. The other three members, however, called for a "pause" and stressed

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