Bank of Mexico raises interest rate to 8.25%

Mexico’s central bank

hiked its benchmark interest rate by 25 basis points on Thursday , as expected, citing increased uncertainty and expectations for stubbornly high inflation.

In a unanimous decision, the Bank of Mexico’s (Banxico) board members voted to raise the overnight interbank rate by 25 basis points to 8.25 percent , its highest level since August 2008 .

During the last monetary policy meeting of 2018 the Bank warned that, though the government budget for 2019 was welcomed by markets, it was important to take action in order to achieve the fiscal targets established.

Furthermore, Banxico anticipated that the increase in the national minimum wage would have a direct impact on inflation levels.

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