The Bank of Mexico (Banxico) continues to work to maintain its credibility, which is why it has made it clear that its commitment is to price stability, said Omar Mejía Castelazo, deputy governor of the central bank.
During his participation in the SHCP Chair, the deputy governor indicated that the actions that Banxico has taken to contain inflation is what gives it credibility, despite the fact that many criticized, at the time, that the Mexican central bank was only following in the footsteps of the Federal Reserve (Fed) of the United States.
“The Bank of Mexico acted in advance, starting this upward cycle of interest rates since June 2021 (…) in the minutes it can be seen that each of the members of the Governing Board is committed to the constitutional mandate. And this is what gives credibility to an institution like Banxico, ”he assured.
He recalled that, since the Bank of Mexico began to raise its interest rate, in mid-2021, to date, it has increased by 725 basis points to a level of 11.25 percent.
“I think that the Bank of Mexico, from the beginning, has made it clear that its commitment is to the stability of the country’s prices,” he said at the event organized by the Faculty of Economics of the UNAM.
Regarding inflation, the deputy governor assured that there is a clear downward trend; However, he recalled that it will not be until the end of 2024 when it returns to Banxico’s target of 3% +/- 1 percentage point.
The most recent data, from the first half of April, suggested a further slowdown in inflation. According to the National Institute of Statistics and Geography, consumer prices grew 6.24% annually.
The above represented its lowest level since October 2021, when it averaged an increase of 6.12 percent. Likewise, it added six consecutive fortnightly slowdowns, after reaching levels not seen in two decades last year.
Although inflation continues outside Banxico’s target range, Mejía Castelazo highlighted that in the last 20 years there has not been an episode where inflation has reached double-digit levels.
