Bank Of Mexico Lowers Key Interest Rate To 10.50% With Single Dissent

• The Bank of Mexico (Banxico) lowered its benchmark interest rate by 25 basis points to 10.50% on Thursday, September 26, the second straight cut as price pressures have been easing in Latin America's No. 2 economy.
• The latest rate cut approved by the central bank's five-member governing board was not unanimous. Deputy Governor Jonathan Heath voted to hold the rate at 10.75%. Analysts polled by Reuters had overwhelmingly forecast the 25-basis-point cut.
• In a statement announcing its decision, Banxico noted that the global inflation outlook has improved while the closely watched core inflation rate, considered a good indicator for price trends, is expected to keep decreasing.
• "Looking ahead, the board expects that the inflationary environment will allow further reference rate adjustments," the statement said, emphasising; however, that the outlook for inflation "still calls for a restrictive monetary policy stance."
• Mexico's annual headline inflation slowed to 4.66% in the first half of September, official data showed on Tuesday, its fourth consecutive fortnight of declines. Core inflation moderated to 3.95%, its lowest level since early 2021.
• In August, Banxico also cut its benchmark interest rate by a quarter percentage point to settle at 10.75% in a divided decision, at the same time that it upwardly revised its year-end forecast for the rate of rising consumer prices.

(Source: Reuters)