Carstens Says Peso Appreciation Will Help Keep Mexico’s Inflation Below 4%

Mexico’s recent peso appreciation will help keep inflation within a range of 3 percent to 4 percent this year, central bank Governor Agustin Carstens said.

“Core inflation is very near our objective of 3 percent,” Carstens told reporters today at the World Economic Forum in Davos, Switzerland. “In general, the performance of inflation has been adequate.” Price growth should “slowly converge to 3 percent in the medium term.”

Carstens said the central bank was “comfortable” with current monetary policy stance, and that it was watching the cost of agricultural products carefully. It is also monitoring international financial markets and “the relative monetary policy stance of Mexico versus other countries.”

Mexico´s economy will grow at least 3.5 percent this year, driven by strong domestic spending, he said.

To contact the reporter on this story: Nacha Cattan in Mexico City at ncattan@bloomberg.net.

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net.

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