Seeking to improve understanding, communication, and cooperation between Mexico and the United States by promoting original research, encouraging public discussion, and proposing policy options for enhancing the bilateral relationship.
Reuters, February 21, 2023
MEXICO CITY, Feb 20 (Reuters) – Mexico’s inflation is forecast to have eased in the first half of February, a Reuters poll showed on Monday, though consumer prices remain well above the central bank’s target, and is likely to make way for another interest rate hike.
Financial Times, 01/31/2023
Mexico’s state-owned oil company Pemex on Tuesday completed a $2bn bond sale, according to people familiar with the deal, with investors demanding a double-digit yield to lend to the heavily indebted group.
The issuance comes as emerging market governments have raised more than $40bn in international bond markets this year after a global sell-off last year triggered by rising interest rates.
8/18/2021
Source: Reuters
Mexican President Andres Manuel Lopez Obrador on Wednesday backed the central bank’s recent moves to raise interest rates, but took a swipe at a board member for criticizing his plan to allocate International Monetary Fund resources to pay off debt.
“I respect that decision they’re taking because inflation must be kept under control,” he told a regular news conference. “This should be something that matters to all of us.”
The board, led by Governor Alejandro Diaz de Leon, lowered the benchmark rate a quarter point to 7.75% after cutting it for the first time in five years in August. The decision was forecast by 22 of 25 economists surveyed by Bloomberg. One expected policy makers to keep the rate unchanged, and two projected a larger half-point cut.
Mexico’s central bank reduced borrowing costs for the second straight month after inflation slowed to its target, the economy stalled and the U.S. cut interest rates.
The board, led by Governor Alejandro Diaz de Leon, lowered the benchmark rate a quarter point to 7.75% after cutting it for the first time in five years in August. The decision was forecast by 22 of 25 economists surveyed by Bloomberg. One expected policy makers to keep the rate unchanged, and two projected a larger half-point cut.
09/26/19 – Bloomberg
By Eric Martin
Mexico’s central bank reduced borrowing costs for the second straight month after inflation slowed to its target, the economy stalled and the U.S. cut interest rates.
The board, led by Governor Alejandro Diaz de Leon, lowered the benchmark rate a quarter point to 7.75% after cutting it for the first time in five years in August. The decision was forecast by 22 of 25 economists surveyed by Bloomberg. One expected policy makers to keep the rate unchanged, and two projected a larger half-point cut.
09/10/19 – Reuters
By Abraham Gonzalez & Anthony Esposito
Mexico’s central bank now has another reason to reduce its benchmark interest rate again this year, as annualized inflation cooled in August to a nearly three-year low and the economy has struggled to pick up steam.
Several analysts raised their bets for a rate cut after inflation eased to 3.16% in August, undershooting the 3.20% consensus forecast of economists polled by Reuters poll and taking the headline rate to its lowest since October 2016.
09/05/19 – Reuters
By Anthony Esposito
Citibanamex, the Mexican unit of Citigroup Inc (C.N), said on Thursday that its latest poll of analysts forecast that Mexico’s central bank will cut its benchmark overnight lending rate by 25 basis points to 7.75% at its Sept. 26 meeting.
In a majority decision, the Bank of Mexico’s five-member board voted at its Aug. 15 meeting to lower the overnight interbank rate by 25 basis points to 8.00%, the first cut since June 2014, citing slowing inflation and increasing slack in the economy.
09/03/19 – Reuters
By Abraham Gonzalez
As central banks across the globe cut interest rates, Mexico’s policymakers still have room to lower borrowing costs by as much as 100 basis points before the peso becomes less attractive than other currencies, fund managers and financial analysts say.
The spread between the key interest rate in the United States (2.0%-2.25%) and that of Mexico (8.0%) stands at 600 basis points, the third highest in the world after Argentina and Turkey and its highest level in a decade.
7/29/19 – Bloomberg
By Nacha Cattan and Eric Martin
Mexico’s interest rates are too high for a slowing economy, President Andres Manuel Lopez Obrador said in an interview, though he added that he respects the central bank’s freedom to set them independently.
“The Bank of Mexico is watching over inflation. That’s not bad,” Lopez Obrador told Bloomberg Editor-in-Chief John Micklethwait in Mexico City. “But it’s important to lower rates to kickstart the economy.”
11/15/2018 – Bloomberg
By Eric Martin
Mexico’s central bank will raise its key interest rate Thursday after President-elect Andres Manuel Lopez Obrador’s decision to cancel a $13 billion airport sent the peso plunging and raised concerns about policy uncertainty, according to a survey of economists.
Policy makers led by Governor Alejandro Diaz de Leon are projected to lift borrowing costs, already at the highest level in almost a decade, another quarter point to 8 percent, according to the median estimate in a Bloomberg survey. Twenty-one economists see policy makers raising the rate, with six projecting it to remain unchanged.
Analysts began to forecast an increase two weeks ago after AMLO, as the leftist is known, said he would cancel construction of the new Mexico City airport already one third complete, spurring the biggest sell-off in the nation’s assets since 2016. While the central bank kept the rate unchanged last month, the board warned that it will take the actions needed to ensure its price goal is reached, and one of the five members voted for a hike.
08/16/18 Reuters
Mexico’s central bank flagged ongoing risks to the inflation outlook due to uncertainty over the NAFTA trade deal, pressure on the peso and the strength of the U.S. dollar, minutes from its latest monetary policy meeting showed on Thursday.
The Bank of Mexico’s board members voted unanimously to hold the benchmark rate unchanged at a more than nine-year high of 7.75 percent MXCBIR=ECI on Aug. 2.
Still, pressures on the peso currency due to higher external interest rates, dollar strength, and a potential escalation in commercial disputes stemming from U.S. trade policy all posed risks to the inflation outlook, the minutes showed.
Mexico Institute 