Exclusive: High rates help Mexico weather NAFTA talks, premature to talk of cuts – Carstens

07/13/2017 Reuters


MEXICO CITY (Reuters) – Mexico’s central bank could pause monetary policy tightening for some time, its governor said on Thursday, but he defended high interest rates at a time of political volatility and knocked down speculation there will be rate cuts before mid-2018.

Banco de Mexico Governor Agustin Carstens said talk among private economists that rates would be reduced early next year diverged from the bank’s view, which was that it would take some time to consolidate inflation toward its 3 percent target.

He also said Mexico’s tight monetary and fiscal policy was good preparation for possible volatility stemming from presidential elections next year and NAFTA negotiations that may start in a few weeks.

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