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Mexico’s central bank raised interest rates to 9.25 per cent, marking the 11th meeting in a row monetary policy has been tightened as inflation expectations remain stubbornly high.

Banco de México raised its reference rate 0.75 percentage points for the third straight meeting, in a move that was widely expected by analysts. It was a unanimous decision among voting policymakers on the bank’s board.

“This reaffirms the hawkish position of the bank and confirms its intention of continuing with aggressive rate increases,” Santiago Fernández of Intercam Banco said in a research note.

Inflation in Mexico reached 8.76 per cent in September, the highest level recorded in nearly 22 years. The bank said Thursday it expected price growth to decelerate less slowly than previously forecast.

“Banxico now expects, as we do, core inflation to remain well above 4 per cent over the next four quarters before easing to levels slightly above 4 per cent in 4Q23,” BBVA economists said in a research note. They forecast a further 1.25 percentage basis points of additional tightening by December, “lifting the policy rate to 10.5 per cent.”

The latest rate increase comes after the bank slashed its outlook for Mexican growth, citing geopolitical issues, a deceleration of the US economy and uncertainty around Mexico entering dispute resolution talks with the US and Canada over complaints it is discriminating against foreign investors in the energy sector.

Banxico’s move follows three consecutive 0.75 percentage point increases by the Federal Reserve in the US.

Read More: Live news updates: Asian stocks edge down after tech sell-off on Wall Street

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