LatinNews Daily - 26 April 2023

In brief: Mexico’s Banxico considers ending rate hike cycle

* The president of Mexico’s central bank (Banxico), Victoria Rodríguez Ceja, said the bank will consider ending its rate hiking cycle at its next meeting on 18 May, given the moderation in inflation in recent months. The benchmark interest rate currently stands at 11.25%. Speaking before the senate’s finance and public credit commission, Rodríguez noted that headline inflation has been declining since August 2022, while core inflation was also showing “positive signs of reduction”. She said that Banxico’s board would take this into consideration at its next monetary policy meeting, stating that “it would not be a surprise if we evaluate the possibility of a rate halt”. Banxico has raised its benchmark interest rate by 725 basis points since the current raising cycle began in June 2021. The last rate hike, announced on 30 March, was smaller than previous increases, suggesting the end of the hiking cycle was in sight. According to the latest figures from Mexico’s national statistics institute (Inegi), annual inflation stood at 6.24% in the first two weeks of April – the lowest rate since October 2021.

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