Carstens Eyes Fed While Weighing Mexico Rate Cut

Mexico central bank Governor Agustin Carstens says the Federal Reserve’s plan to spur the U.S. recovery may help his country. He also says his bank would take action if needed to protect the Mexican economy and peso, even by cutting interest rates.

Carstens, at Bloomberg’s Mexico Economic Summit in Mexico City yesterday, said he sees no need to curb capital inflows now because the peso isn’t overvalued. He forecasts the region’s second-biggest economy will grow 5 percent this year even as the U.S., which buys 80 percent of Mexico’s exports, struggles to recover from recession.