Despite a stronger peso in recent weeks, inflation continues to show an upward trend that is expected to continue through the year, the Bank of México said today when it announced a quarter-point hike in its benchmark interest rate.
The sixth consecutive increase, the third this year, bumped the rate to 6.75% and follows an increase in the inflation rate to nearly 6% last month.
That was more than any analyst had expected, Bloomberg reported today, and well over the central bank’s target of 3%.
The peso dipped to a record low in January but has since risen 17%. It was trading at 18.7995 to the dollar in New York after the interest rate announcement.
The bank expects a lower inflation rate towards the end of the year and into 2018.
Today’s rate increase came as a surprise. Most analysts expected the rate to remain unchanged.