Omar Meija, the newly-appointed deputy governor of the Bank of Mexico, stated on Wednesday that the central bank could decide to slow down the rate of its interest rate increase. He claimed that one such action could enable the Mexican economy to grow this year despite the tight monetary policy.
“I believe that going forward we could consider slowing the pace of rate adjustments, as it is already very close to the appropriate level to consolidate a de-inflationary process,” Meija announced during an interview. This comes after Mexican President Andrés Manuel López Obrador stated the importance of achieving a balance between suppressing inflation and allowing economic growth.
Meija admitted that the battle against inflation has taken longer than expected, however, he remains confident that the Bank of Mexico will meet its target by the fourth quarter of 2024. He labeled the core component of inflation as the country’s main challenge at present.
Annual headline inflation in the first half of February stood at 7.76%, while core inflation, which excludes more volatile prices such as food and energy, hit 8.38%.