- Decision
- Lower
- Rate change
- 25 bps
- overnight interbank interest rate
- 6.25%
The Central Bank of Mexico’s Governing Board decided by majority to make a one-time cut in its overnight interbank interest rate target of 25 basis points to 6.25%, effective November 6, 2026, citing continued disinflation, economic slack and the absence of demand-side pressures. The rate had declined in quarter-point steps from 7.25% in November 2025 to 6.50% in May 2026 before being held through September. Headline inflation rose to 3.62% in the first fortnight of October 2026, driven by non-core inflation, while core inflation edged down. The central bank raised its inflation forecasts for the fourth quarter of 2026 but still expects headline inflation to converge to its 3% target in the fourth quarter of 2027, with risks remaining tilted upward. Mexico’s economy continued expanding in the third quarter, although slack is expected to persist throughout the forecast horizon and growth risks remain to the downside. The Mexican peso depreciated, but the Governing Board judged that economic slack would limit exchange-rate pass-through to consumer prices. Globally, higher energy prices lifted headline inflation in several major advanced economies, core inflation remained persistent and uncertainty surrounding the Middle East conflict continued. The Governing Board signalled that maintaining the reference rate at its new level for an extended period would support inflation convergence and be appropriate to address external macroeconomic challenges.