The Bank of Mexico’s governing board unanimously decided to increase interest rates by 75 basis points after its monetary policy meeting on August 11.

As a result of this decision, the key policy rate now stands at 8.5%. This was the second consecutive 75bp rate increase, a move widely anticipated by markets.

Despite a gradual policy tightening initiated in June 2021, inflation keeps on rising, way over the 3% target.

Last month, the headline reading increased year on year by 8.2%, and core