© Reuters. FILE PHOTO: Galia Borja, Deputy Governor of Banco de Mexico, poses for a portrait at an Worldwide Ladies’s Day occasion hosted by the Mexican inventory alternate in Mexico Metropolis, Mexico March 8, 2023. REUTERS/Toya Sarno Jordan
MERIDA, Mexico (Reuters) – Financial institution of Mexico’s predominant focus is tackling inflation, deputy governor Galia Borja mentioned on Thursday, when requested how fears of a banking disaster roiling U.S. and European markets might affect financial coverage on the central financial institution.
“Many variables come into play,” Borja instructed Reuters on the sidelines of a banking conference within the metropolis of Merida in Mexico’s Yucatan peninsula. “However the primary one is inflation, which is our mandate.”
“The conduct of inflation is extra vital, however we take every thing under consideration,” she added.
Financial institution of Mexico Governor Victoria Rodriguez mentioned afterward Thursday that the central financial institution’s board would take into account “the financial stance that has already been reached, in addition to how the info have developed” when it met subsequent on March 30.
Mexico’s core client costs slowed by greater than anticipated to eight.29% within the yr to February, information from statistics company INEGI confirmed final week, offering some reduction as Latin America’s second-largest economic system grapples with excessive inflation and rates of interest.
The failures final week of U.S.-based Silicon Valley Financial institution and Signature Financial institution (NASDAQ:) throughout a interval by which central banks have been quickly elevating rates of interest to sort out inflation have rippled by way of monetary markets across the globe.
The turmoil has fueled hypothesis that it might result in a rethink of financial coverage at central banks.
Rodriguez mentioned the central financial institution didn’t foresee a adverse spillover on Mexican banks, noting they have been “well-capitalized” with room to maneuver above regulatory minimums.
Financial institution of Mexico final month raised the important thing rate of interest by 50 foundation factors to 11.00%, however minutes of the assembly confirmed most board members thought of a extra modest price rise might be made on the March 30 assembly.
