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MEXICO: Central Bank To Maintain Interest Rate At 7% - Survey

(Agencia CMA Latam) - After seven consecutive increases, analysts expect Banco de México (Banxico) to keep its benchmark interest rate unchanged at 7.0% at the board meeting scheduled for this week, according to a Citibanamex poll.

There are multiple opinions on the next central bank moves. While some analysts expect a 25 basis points (bp) increase in the benchmark interest rates in September, November, and December, and rate cuts starting at the February 2018 meeting, other forecast rate cuts this semester.

At its last meeting, on June 22, Banxico's board decided to increase its main interest rate by 25 basis points, to 7%, to strengthen the anchoring of inflation expectations and the monetary policy's pressure to guide inflation towards its target.

Prices in the Mexico had the fastest rise since December 2008 in June and were more than two times above the 3% target set by the central bank, in spite of higher interest rates.

by Agencia CMA Latam

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