Mexico central bank raises benchmark interest rate to 9.25% from 8.50%

The Mexico central bank, Banxico, said the board was unanimous on the rate decision where it raised the benchmark interest rate to 9.25% from 8.50%.

Key notes

• Says the balance of risks for the trajectory of inflation within the forecast horizon remains biased significantly to the upside.
• Says the board will thoroughly monitor inflationary pressures as well as all factors that have an incidence on the foreseen path for inflation and its expectations.
• Says the board will assess the magnitude of the upward adjustments in the reference rate for its next policy decisions based on the prevailing conditions.
•  Says an environment of uncertainty prevails, while the balance of risks for economic activity remains biased to the downside.
• Says the accumulated inflationary pressures associated with both the pandemic and the military conflict continue affecting headline and core inflation.  
• Sees average annual headline inflation of 8.6% for the fourth quarter of 2022.

Meanwhile,  USD/MXN is 0.25% bid on the day at 20.1570.