Banxico Holds Steady

Mexico’s central bank, Banco de México (Banxico), has held interest rates steady for the first time after nine months of reductions. Last month, the overnight benchmark rate was lowered to its current 21-month low of 7% in a cut that surprised the market. Mexico’s economy expanded by 5.5% in the first quarter of this year, spurred on by cuts in interest rates. Despite the recent weakening of the peso against the dollar, the government is confident it will hit its inflation target of 3% this year.