There is still a way to go on monetary policy, says Jonathan Heath

There is still a way to go on monetary policy, says Jonathan Heath

Heath affirmed that with the rise of half a percentage point the monetary stance “reenters the neutral zone” but there is still a way to go given the levels of inflation in Mexico.

“I think that the position consistent with the current inflation scenario should be restrictive, so there is still a long way to go,” the deputy governor said on his Twitter account.

Inflation accelerated in April to levels not seen in more than 21 years at 7.68% at the interannual rate, while core inflation, considered a better parameter to measure the trajectory of prices because it eliminates high volatility products, registered a variation of 7.22%, also the highest since January 2001.

Analysts have said that Banxico’s decision on Thursday showed a more restrictive central bank that seeks to fight inflation. Estimates for the end of the year now place the rate at levels of up to 9.5%, from a previous 8.5%.

With information from Reuters



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