Mexico's central bank lowered interest rates on Friday for the second month in a row, but policymakers said there were signs the economy had seen the worst of a recent slowdown and that no further rate cuts were advisable.
The Banco de Mexico lowered its benchmark interest rate by 25 basis points to 3.50 percent, its lowest-ever level. Most analysts polled last week by Reuters had forecast a quarter point cut, though some expected a bigger move.
The central bank said that the "adverse shocks" to the economy in the past few months appeared to be fading. It added that the inflation outlook had improved and that a government tax reform plan was unlikely to spur widespread price pressures.
Mexico economy contracted in the second quarter for the first time in four years, prompting policymakers to unexpectedly cut its benchmark rate in September. Devastating floods across the country last month have further dampened growth prospects.
Source: Reuters
