Bank of Mexico

August 11, 2016

Having cut its policy rate at the prior meeting on June 30 by 50 basis points, today’s decision not to change monetary policy further at this time was expected. A released statement noted slower growth and projected that policy is consistent with the targeted 3% inflation in 2017. If Donald Trump is elected U.S. president in November, the Mexican economy and peso will be in the proverbial hurt locker. The June increase in Mexico’s benchmark interest rate to 4.25% was not the first move of the year. A similar jump was mandated in February. The rate had been at 3.25% since October 2014 and now is at a 3-year high.

Copyright 2016, Larry Greenberg.  All rights reserved. No secondary distribution without express permission.

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