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Bank of Mexico governor says pace of hikes may change as needed By Reuters


© Reuters. Mexico’s Central Bank Governor Victoria Rodriguez Ceja poses for a photograph after an interview with Reuters on the annual banking conference, in Acapulco, Mexico March 25, 2022. REUTERS/Javier Verdin

By Anthony Esposito

ACAPULCO, Mexico (Reuters) – The Bank of Mexico doesn’t must strictly monitor the U.S. Federal Reserve’s anticipated rates of interest hike path and might tighten financial coverage at its personal pace as it seeks to curb inflation, the central financial institution governor advised Reuters on Friday.

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The 5 board members of Banxico, as the central financial institution is thought, voted unanimously to boost the benchmark rate of interest by 50 foundation factors to six.5% on Thursday, the seventh hike in a row. It was additionally the third straight 50-basis level improve.

“We’re of course involved first of all in regards to the inflation we’re observing,” Victoria Rodriguez, who took the helm at Banxico in January, stated in an interview on the sidelines of an annual banking convention within the seaside resort of Acapulco.

She famous the Fed’s coverage trajectory was an “essential variable” for Mexico however not the one one and that inflation has been rising for 15 straight months.

“It’s not as if beforehand we’ve got determined to match one after the other” the Fed’s anticipated price hikes, Rodriguez stated.

Inflation hit 7.29% within the first half of March, barely decrease than the earlier two-week interval, however greater than double Banxico’s goal price of 3%. The financial institution has a one proportion level tolerance vary above and under the goal.

“We don’t know but if we’re going to keep up this pace (of price hikes) or one other. It’ll be what is important to adjust to our mandate of a 3% inflation goal,” stated Rodriguez.

Rodriguez expects inflation ought to peak throughout the first half of 2022 after which start a downward trajectory in direction of goal within the first quarter of 2024.

Nevertheless, dangers and uncertainty have risen following Russia’s invasion of Ukraine, which have fueled power and grains worth hikes.

“Relating to inflation there might be a major influence…we shall be being attentive to what occurs and if we see an influence on inflation we are going to take the mandatory measures,” stated Rodriguez.

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