Advanced Search

LatinNews Daily - 15 October 2021

Click here for printer friendly version
Click here for full report

In brief: Mexico’s Banxico highlights inflationary pressures

* Mexico’s central bank (Banxico) has released the minutes of a meeting of its board of directors which reveal that all five board members believe that “global inflationary pressures and bottlenecks in production continue affecting headline and core inflation” in Mexico. The minutes were from the 30 September meeting which produced the decision to raise the benchmark interest rate by 25 basis points to 4.75%. According to the minutes, the majority of board members pointed out that expectations for headline and core inflation for 2021 and 2022 increased again, while medium and long-term inflation expectations have remained more stable, although the latter are at levels above the target. They highlighted that short-term expectations are well above target: Mexico’s annual inflation stood at 6.00% in September, exceeding the 3% +/-1 inflation target range set by the central bank (Banxico). According to the minutes “the majority of board members also pointed out that inflationary pressures are associated with shocks that are expected to be transitory. However, they noted the risk of a negative impact on the price formation process.”