Banxico Monetary Policy Statement - 2025-11-06
Central bank: banxico | Type: decision | Date: 2025-11-06

November 6, 2025
This document is provided for the reader’s convenience only. The translation from the official Spanish version was made by Banco de México’s
staff. Discrepancies may possibly arise between the original document in Spanish and its English translation. For this reason, the original Monetary
Policy Statement in Spanish remains the only official document.
Banco de México’s Governing Board decided to lower the target for the overnight interbank
interest rate by 25 basis points to 7.25%, effective November 7, 2025.
World economic activity is expected to have expanded during the third quarter of 2025 at a lower rate
than in the previous quarter. Given the current trade tensions, the world economy as well as that of the
United States are still anticipated to decelerate this year and in 2026 with respect to 2024. In most
advanced economies, headline inflation increased with respect to the levels observed at the end of the
second quarter, while core inflation showed resi stance to decline. The Federal Reserve lowered its
reference rate by 25 basis points. Financial markets registered minor variations. The US dollar
appreciated. US government interest rates fluctuated moderately. Among the most relevant global risks
are the escalating trade tensions along with the intensification of geopolitical turmoil and their possible
impact on inflation, economic activity, and volatility in financial markets.
Since the previous monetary policy decision, Mexico’s short - and medium-term government interest
rates decreased, while those for longer terms increased moderately. The Mexican peso depreciated
slightly. During the third quarter of 2025, economic activity contracted with respect to the second quarter.
The environment of uncertainty and trade tensions continues posing significant downward risks.
Between the first fortnight of September and the first fortnight of October, headline inflation decreased
from 3.74 to 3.63%, while core inflation registered a minor variation, from 4.26 to 4.24%. Headline inflation
expectations for the end of 2025 were revised downwards, while those for longer terms continued
relatively stable at levels above target.
Headline and core inflation forecasts were adjusted slightly for the short term. Headline inflation is still
expected to converge to the target in the third quarter of 2026 (see table). Forecasts are subject to the
following risks. On the upside: i) depreciation of the Mexican peso; ii) persistence of core inflation; iii)
disruptions due to geopolitical conflicts or foreign trade policies; iv) cost- related pressures, and v)
climate-related impacts. On the downside: i) lower-than-anticipated economic activity; ii) a lower pass-
through from increased costs, and iii) lower pressures stemming from the appreciation of the national
currency. Although the balance of risks for the trajectory of inflation within the forecast horizon remains
biased to the upside, said bias is less pronounced than that faced between 2021 and 2024. The changes
in economic policy by the US administration continue adding uncertainty to the forecasts. Their effects
could imply inflationary pressures on both sides of the balance.
The Governing Board deemed appropriate to continue the rate-cutting cycle. This decision was consistent
with the assessment of the current inflationary outlook. In particular, it took into account the behavior of
the exchange rate, the weakness of economic activity, and the possible impact of changes in trade
policies worldwide. It also considered the level of monetary restriction that has been implemented. Thus,
with the presence of all its members, the Board decided by majority to lower the target for the overnight
interbank interest rate by 25 basis points to 7.25%.
Looking ahead, the Board will evaluate reducing the reference rate. It will take into account the effects
of all determinants of inflation. Actions will be implemented in such a way that the reference rate remains
consistent at all times with the trajectory needed to enable an orderly and sustained convergence of
headline inflation to the 3% target during the forecast period. The central bank reaffirms its commitment
to its primary mandate and the need to continue its efforts to consolidate an environment of low and
stable inflation.
Voting in favor of the decision were Victoria Rodríguez, Galia Borja, Gabriel Cuadra, and Omar Mejía.
Jonathan Heath voted in favor of maintaining the target for the overnight interbank interest rate at 7.50%.
1/ Forecast starting in October 2025.
2/ Forecast starting in September 2025. See monetary policy statement of September 25, 2025.
3/ See methodological note on the seasonal adjustment process.
Source: INEGI for observed annual variation figures and Banco de México for seasonally adjusted figures and forecasts.
Note: Shaded areas correspond to observed figures.
IV I II III IV I II III IV I II III
Headline (CPI)
Current (11/06/2025) 1/ 4.5 3.7 4.2 3.6 3.5 3.5 3.2 3.0 3.0 3.0 3.0 3.0
Previous (09/25/2025) 2/ 4.5 3.7 4.2 3.6 3.6 3.4 3.1 3.0 3.0 3.0 3.0 3.0
Current (11/06/2025) 1/ 3.7 3.6 4.1 4.2 4.1 3.8 3.3 3.0 3.0 3.0 3.0 3.0
Previous (09/25/2025) 2/ 3.7 3.6 4.1 4.2 4.0 3.6 3.2 3.0 3.0 3.0 3.0 3.0
Annualized seasonally adjusted quarterly variation in percent3/
Current - Headline 1/ 3.3 2.7 5.6 2.8 2.8 2.9 3.6 2.7 2.7 2.9 3.5 2.8
Current - Core1/ 3.6 4.3 4.9 4.3 3.1 3.0 2.9 3.1 3.0 3.0 2.9 3.0
Forecasts for Headline and Core Inflation
Annual percentage change of quarterly average indices
2025 2026 2027