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  • Mexico's Central Bank cut its benchmark interest rate for the ninth consecutive time on Thursday amid continuing risks that the coronavirus pandemic poses to the economy and financial markets. The bank cut the inter-bank rate by 50 points to 5.0 percent, it said in a statement. "The challenges posed by the pandemic on monetary policy include both the significant impact to economic activity and a financial shock," said the bank. It noted that the Mexican economy, the second biggest in Latin America after Brazil, shrank considerably in the first quarter of 2020 while the impact of the virus has "exacerbated" the situation for April. "Although the reopening of some sectors and regions in May and June will precipitate a certain recovery in economic activity, the impact has been considerable and uncertainty persists," said the bank's governing board. The Central Bank is expecting Mexico's economy to shrink by 8.8 percent this year while the International Monetary Fund is predicting a 10.5 percent fall. On the other hand, the bank noted that the peso has risen in value while interest rates on local debt fell. As for inflation, the bank said it remains on target for expectations of 3.0 percent by the end of the year, with a range of plus or minus 1.0 percent. jla/mr/bc/acb
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  • Mexico cuts interest rate for 9th straight time
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