Mexico’s industrial production fell three times more than analysts forecast in March, reinforcing expectations that the central bank will cut interest rates for the second time since 2009 later this year.
Mexican consumer prices rose the least in 11 months in April as Grupo Financiero Banorte SAB and UBS AG joined other traders in forecasting the central bank will cut the key interest rate again this year.
Mexico central bank Governor Agustin Carstens, who oversaw the first benchmark rate cut since 2009, said lax monetary policies in developed nations and slowing inflation will help determine future interest rate decisions.
Mexican central bank policymakers, who cut the benchmark rate this year for the first time since 2009, said they will take into account the lax monetary policies being carried out in other countries in future decisions.
Mexico had its credit rating raised by Fitch Ratings on the prospect that proposed legal changes will boost growth in Latin America’s second-largest economy. The peso surged to the strongest level since August 2011.
Mexico’s central bank Governor Agustin Carstens said he was misunderstood by investors who earlier this week interpreted his comments on interest rates as a sign policy makers may cut borrowing costs in the second half of the year.