Mexican Central Bank Hikes Key Interest Rate to 7%

Mexico’s central bank has announced its decision to raise the interest rate on the main refinancing operations by 25 basis points to 7 percent, in a statement released Thursday.

MEXICO CITY (Sputnik) — This is the ninth time that the benchmark interest rate has been raised and its highest value since the Bank of Mexico last set a 7.5-percent rate in March 2009.

The banking authority explained it decision by attempts to rein in inflation that has climbed this year past the 3-percent target to as high as 6.3 percent.

Mexico began ratcheting up the main interest rate last year when the exchange rate of its national currency grew volatile on news of UK’s decision to leave the European Union. Donald Trump’s presidential victory in the United States and his protectionist policies further undermined the Mexican peso.