MEXICO CITY (Reuters) – Mexico’s central bank will hold its benchmark interest rate steady for the sixth consecutive time later this week, a Reuters poll showed on Monday, in line with policymakers’ recent remarks that suggest discussions on rate cuts will begin next year.
Twenty-two of the 23 analysts polled expect Banxico, as the central bank is known, to hold the key interest rate at the current record high of 11.25% when it issues its policy decision at 1 p.m. local time (1900 GMT) on Thursday. The central bank, which began a rate hiking cycle in June 2021, has held the key rate at its current level since March.
Only one analyst expects the central bank to cut the rate by 25 basis points to 11%.
Mexico’s headline inflation rate ticked up to 4.32% in November, while core inflation continued to ease.
Multiple members of Banxico’s five-person governing board brought forward the idea of discussing cuts to the key interest rate during the first quarter of 2024, minutes from the bank’s latest monetary policy meeting show.
The inflation outlook, however, remains “challenging,” the minutes said.
Mexico’s first-quarter inflation data will be key for the central bank’s upcoming monetary policy decisions, board member Jonathan Heath said in a recent interview.