Mexico and Peru Central Banks Hold Key Rates Steady

Mexico's central bank, Banxico, kept its benchmark interest rate at 6.5% following a cycle of cuts that began in March 2024. The board said current inflation remains above the 3% target, demand pressures are weak and the exchange‑rate environment is stable. It also noted a temporary boost to tourism from the 2026 World Cup and signalled a prolonged pause before any further moves, while revising its 2026 growth forecast down to 1.1%.

Peru's central bank, the BCRP, left its reference rate unchanged at 4.25% in July. Officials pointed to June inflation of 4.0% overall and 4.5% core, driven by higher food prices and fuel costs. They warned that an intense El Niño and ongoing geopolitical tensions could keep price pressures elevated. The bank reiterated its commitment to bring inflation back to target and to act if needed.

Both banks are adopting a cautious stance amid lingering inflation risks and external uncertainties.