The Bank of Mexico cut its benchmark interest rate by 50 basis points to 4% today, marking its first adjustment in almost four years and bucking an Americas-wide trend this week to hold rates steady.

The Mexican central bank board of governors cited reduced domestic demand and a slack labour market, characterised by rising unemployment, as the motivation behind the first rate change since July 2009.

Inflation increased to 3.55% in February and will continue to climb to around 4%, the central