Mexico central bank seen raising rates, maybe for last time this year

6/22/2017 Reuters

banco de mexicoMexico’s central bank is likely to raise interest rates on Thursday, in what the market is betting could be its last hike this year, to contain a spike in inflation and following the U.S. Federal Reserve’s move to increase borrowing costs.

The Banco de Mexico is seen raising its benchmark rate by a quarter percentage point to 7.00 percent, according to all 17 analysts surveyed by Reuters.

Analysts say that move, which would match the Fed’s quarter-point rate hike last week, would help maintain the appeal of peso-denominated debt to yield-hungry investors.

The central bank has raised its main interest rate in its previous six meetings to the highest level since early 2009 as inflation rose to a more than eight-year high.

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