LatinNews Daily - 07 November 2025

*Mexico’s central bank (Banxico) has lowered its benchmark interest rate by 25 basis points to 7.25%, following two rate cuts of the same size in September and August. In a statement explaining its decision, Banxico noted that economic activity contracted in the third quarter as compared to the previous quarter and that an “environment of uncertainty and trade tensions continues to pose significant downside risks”. It noted that between the first two weeks of September and the first half of October, headline inflation decreased from 3.74% to 3.63%, while core inflation dropped marginally from 4.26% to 4.24%. Banxico slightly lowered its inflation forecast for the end of this year to 3.5%, down from 3.6% in its previous (September) policy meeting, while it revised up its core inflation forecast to 4.1%, up from 4.0%. “Looking ahead, the Board will evaluate reducing the reference rate,” read a Banxico statement, omitting a reference made in previous reports to “further adjustments” to the rate. “It will take into account the effects of all determinants of inflation,” it said.

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