In their last meeting, the central bank officials made the decision to reduce the target for the overnight interbank interest rate by 25 basis points, bringing it to a level of 10.25%. The determination was unanimous, unlike previous votes. Although there are still inflationary risks, the central bank considers that these will dissipate towards the end of 2025.
According to financial authorities, despite some ongoing volatility, financial markets have shown orderly behavior. Additionally, the risk balance for economic activity remains skewed to the downside, which influences the bank's restrictive stance. However, based on the positive evolution of core inflation, they have decided to reduce the degree of monetary tightening.
Regarding inflation projections, inflation is expected to close this year at 4.7%, while for the first two quarters of 2023, figures slightly above those previously estimated are anticipated. Despite these adjustments, the bank maintains the target of 3% for the end of 2025.
The head of government of Mexico City, Claudia Sheinbaum, confirmed a new price agreement with businessmen in order to contain inflation. This adjustment in the interest rate aligns with market expectations, which foresee gradual adjustments in the future. The Bank of Mexico ratified its decision to cut the interest rate, reducing uncertainties and thereby sending clear signals to financial markets and the economy in general.
