Banxico Monetary Policy Statement - 2025-06-26
Central bank: banxico | Type: decision | Date: 2025-06-26

June 26, 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 50 basis points to 8.00%, effective June 27, 2025.
World economic growth is estimated to have expanded during the second quarter of 2025 at a rate similar
to that observed in the previous quarter. Given the foreign trade tensions, the world economy as well as
that of the United States are expected to decelerate this year and in 2026 with respect to 2024. Financial
markets registered lower levels of volatility. The US dollar continued depreciating. Government interest
rates of the major advanced economies exhibited moderate changes . In most of these economies,
headline and core inflation decreased over the last months. In its latest monetary policy decision, the US
Federal Reserve left its reference rate unchanged. 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 government interest rates decreased for all terms.
The Mexican peso continued appreciating. The Mexican economy expanded moderately in April.
Nevertheless, economic slack prevails due to the weakness that the economy has been exhibiting. The
environment of uncertainty and trade tensions poses significant downward risks.
Headline inflation rose from 3.93% in April to 4.51 % between April and the first fortnight of June. Core
inflation increased from 3.93 to 4.20% during the same period. Headline inflation expectations for the end
of 2025 were revised upwards while those for longer terms remained relatively stable at levels above target.
Inflation forecasts were adjusted upwards . Services inflation has declined more gradually and
merchandise inflation has increased more than expected. Headline inflation is still expected to converge
to the target in the third quarter of 2026 (see table). F orecasts are subject to the following risks. On the
upside: i) foreign exchange depreciation; ii) disruptions due to geopolitical conflicts or foreign trade
policies; iii) persistence of core inflation; 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 recent appreciation of the Mexican peso. 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 new
US administration have added uncertainty to the forecasts. Their effects could imply inflationary
pressures on both sides of the balance.
The Governing Board deemed appropriate to continue calibrating the monetary policy stance. This
decision was made considering the behavior of the exchange rate , the weakness of economic activity ,
and the possible impact of changes in trade policies worldwide. Taking into account the current
inflationary outlook and the prevailing level of monetary restriction, with the presence of all its members,
the Board decided by majority to lower the target for the overnight interbank interest rate by 50 basis
points to 8.00%.
Looking ahead, the Board will assess further adjustments to 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 8.50%.
1/ Forecast starting June 2025.
2/ Forecast starting May 2025. See monetary policy statement of May 15, 2025. Forecast presented in the Quarterly Report
January-March 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.
III IV I II III IV I II III IV I II
Headline (CPI)
Current (06/26/2025) 1/ 5.0 4.5 3.7 4.3 4.1 3.7 3.4 3.1 3.0 3.0 3.0 3.0
Previous (05/15/2025) 2/ 5.0 4.5 3.7 3.9 3.5 3.3 3.2 3.1 3.0 3.0 3.0
Current (06/26/2025) 1/ 4.0 3.7 3.6 4.1 3.8 3.6 3.4 3.1 3.0 3.0 3.0 3.0
Previous (05/15/2025) 2/ 4.0 3.7 3.6 3.9 3.6 3.4 3.3 3.0 3.0 3.0 3.0
Annualized seasonally adjusted quarterly variation in percent3/
Current - Headline 1/ 5.1 3.1 2.9 5.7 4.1 2.1 2.4 3.8 3.6 2.1 2.5 3.5
Current - Core1/ 3.6 3.5 4.2 4.6 3.1 2.9 3.3 3.1 2.9 2.9 3.1 3.0
Forecasts for Headline and Core Inflation
Annual percentage change of quarterly average indices
2024 2025 2026 2027