The Bank of Mexico has warned about the possible effects of the tariffs imposed by Donald Trump on global Gross Domestic Product (GDP). According to the risk analysis conducted by the institution, the implementation of restrictive policies could reverse economic integration at a global level, aggravate geopolitical tensions, and increase volatility in financial markets. Although the Board of Governors has already revised down the inflation forecast for the first quarter of the year, they warn that if the mentioned tariffs are applied, inflation could accelerate in both the United States and Mexico.
Regarding Trump's trade threats, an agreement was reached on Monday, February 3, between Claudia Sheinbaum and the President of the United States that led to a pause in the imposition of tariffs for at least a month. Among the agreed points is the reinforcement of the northern border by Mexico with 10,000 National Guard elements, the commitment of the United States to prevent the trafficking of high-powered weapons to Mexico, and the initiation of work on security and trade by both governments. Despite this pause, the Secretary of Economy, Marcelo Ebrard, has indicated that there are no guarantees that Trump will extend this measure and has warned that tariffs could be applied in March.
Experts have reacted to the 50 basis point cut to the interest rate of the Bank of Mexico. Alfredo Coutiño of Moody's Analytics suggests that the decision was made in a context of growing internal and external risks, while Gabriela Siller of Grupo Financiero Base mentions that part of the market expected a smaller cut. This movement in the interest rate will also affect other interest rates in the economy, which will translate into lower interest rates for those with variable-rate loans.
The Board of Governors of the Bank of Mexico has highlighted that in future monetary policy meetings, they may apply additional cuts to the interest rate. It is expected that the inflationary environment will allow this trend to continue, maintaining a restrictive stance. Regarding global risks, the Board warns that Trump's trade policies pose a threat to the global economy, which has generated an environment of uncertainty worldwide.
