Bank of Mexico Cuts Benchmark Interest Rate Down to 4 Percent
Posted on 02/11/2021
The Bank of Mexico (Banxico) cut its benchmark interest rate by 25 basis points to 4.00% as expected, lowering borrowing costs for the first time since September 2020 amid uncertainty on the economic outlook in the coronavirus (COVID-19) pandemic. This is the lowest rate since June 2016. The decision to cut, unanimously made by the central bank’s five board members. The Bank of Mexico is resuming its monetary easing cycle after two meetings on hold.
Mexico’s economy in 2020 suffered its biggest annual contraction since the 1930s, according to data published by the National Autonomous University of Mexico (UNAM). During the second half of 2020, the Mexican economy made up much of the ground lost to the pandemic.
Keywords: Banco de México.
