Banco de Mexico leaves one-day interbank overnight funding rate unchanged at 8.25%

By Richard Connell

New York, Oct 17 - Banco de Mexico's Board of Governors left its one-day interbank overnight funding rate unchanged at 8.25%, citing both an increase in inflation and an economic slowdown, according to a press release.

The board noted that the global financial crisis and the volatility in the financial markets have negatively impacted the economies of emerging market countries.

The board of the Mexican central bank also pointed out that the ongoing recession in industrialized countries, particularly the United States, has also had a negative affect on the domestic economy of Mexico.

Regarding inflation in Mexico, the board is anticipating a continued upward trajectory, based on economic indicators as well as the phasing out of energy subsidies.

The board concluded that leaving the overnight rate unchanged was the best way to fight inflation and the domestic economic slowdown.

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