Bank of Mexico cuts rate to 7.25%, expects inflation to hit 3% by Q3 2026.

Mexico’s central bank, Bank of Mexico, has cut its benchmark interest rate by 25 basis points to 7.25%, continuing its cycle of rate reductions. This is the lowest level since May 2022.

Deputy Governor Jonathan Heath has opposed a rate cut due to concerns over persistent core inflation exceeding the central bank’s 3% target.

While recent data showed declines in both headline and core inflation in early October, core inflation remained above the target range at 4.24%.