Banxico Raises Interest Rates for Sixth Straight Time amid Soaring Inflation
Mexico’s Central Bank (Banxico) on Thursday, Feb. 10, raised its key interest rate for the sixth consecutive time in response to what it called greater and longer-than-expected inflationary pressures. B
Banxico said in a statement that its governing board had decided by majority vote to raise the target for the overnight interbank interest rate by 50 basis points, to 6 percent, effective on Friday, Feb. 11.
Mexico’s headline inflation, the raw inflation figure reported through the consumer price index, reached 7.07 percent year-on-year in January, Banxico said.
The bank said it also raised its forecasts for the country’s headline inflation at the end of this year to 4 percent, and to 3.1 percent for the end of 2023.
Banxico has a 3-percent inflation target, but the figure has climbed to its highest level in two decades, largely due to the covid-19 pandemic, it said.
According to the bank, world inflation has continued increasing due to pressures driven by bottlenecks in production and high levels of food and energy prices, among other factors.