MNI BRIEF: Banxico Cuts 50BP Again, Expects Repeat In May

The Central Bank of Mexico voted unanimously Thursday to reduce its overnight interbank benchmark by another 50 basis points to 9.00% and indicated it expected one more cut of the same size at the May meeting.

The move marked the sixth consecutive rate cut for Banxico. "The Board estimates that looking ahead it could continue calibrating the monetary policy stance and consider adjusting it in similar magnitudes. It anticipates that the inflationary environment will allow to continue the rate cutting cycle, albeit maintaining a restrictive stance," the statement said.

The decision was in line with market expectations. 

Banxico said it continues to expect headline inflation to converge to the 3% target by the third quarter of 2026.

"It will take into account the effects of the country’s weak economic activity and the incidence of both the restrictive monetary policy stance that has been maintained and the stance prevailing in the future on the evolution of inflation throughout the horizon in which monetary policy operates," the statement said. (See MNI INTERVIEW: Banxico Not Tied To Multiple 50BP Cuts-Borja)