Cautious Banxico Cuts to 7.75% After Mexico Growth Falls

Mexico’s central bank opted to cut its key lending rate by a quarter-point to 7.75 per cent, rather than the half point move that some analysts said it had room for, after the economy contracted in July by more than had been expected, the Financial Times reported. Thursday’s decision was not unanimous however, as two of the five board members pushed for a half-point cut. Banxico’s second cut in a row is a bid to revive the moribund economy as inflation has tamed and the peso is stable against the dollar. It had been widely anticipated, especially after the US Federal Reserve cut rates twice since July and as Mexico’s central bank has tended to move in lockstep. Read more