Banxico’s inflation target is 3% with a margin of one percentage point up or down. Inflation has been outside this range for 24 consecutive months.
“The Governing Board evaluated the magnitude and diversity of inflationary shocks and their determinants, as well as the evolution of medium- and long-term expectations and the price formation process,” they said in the statement.
Banxico expects inflation to converge to the target in the fourth quarter of 2024. The upward risks foreseen by the central bank are the persistence of core inflation, exchange rate depreciation in the face of international financial volatility, and pressure on energy prices. and food.
Banxico’s movement was in line with the movement of the Federal Reserve (Fed) in the United States, which raised the rate by 25 percentage points and set the rate in a range of 4.75% to 5%.
Maintains inflation forecasts
Banco de México maintained its headline inflation forecasts for the coming quarters. For the first and second quarters of the year, a marginal reduction of 7.5% and 6.3%, respectively, is expected.
It is estimated that it will be until the second quarter of 2024 when inflation registers rates of 3.1%.