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Mexico's inflation faces upward risks: Banxico

MEXICO CITY
2024-01-05 09:59

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MEXICO CITY, Jan. 4 (Xinhua) -- The Central Bank of Mexico (Banxico) warned Thursday against a potential upwards tendency in inflation.

While the disinflationary process has made progress, there was risk from "persistent" inflationary pressures, said the Governing Board of the Banxico at its latest monetary policy meeting.

The board's five members unanimously agreed to maintain the overnight interbank lending rate at 11.25 percent to dampen inflationary pressure, as announced on Dec. 14.

"To achieve the orderly and sustained convergence of overall inflation to the 3 percent target, it will be necessary to maintain the reference rate at its current level for a certain period of time," the board said.

Most of the members expect inflation to reach the target rate in the second quarter of 2025.

Inflation in Mexico stood at 4.46 percent year-on-year until the first two weeks of December, according to the most recent official data.

The consumer price index (CPI) hit 7.82 percent in 2022, the highest level in two decades, driven by price increases linked to the COVID-19 pandemic and other factors.
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