Economics
Banxico Board Member Warns Price Controls Only Work Short Term
- Out-of-the-box thinking welcome but caution needed, Heath says
- AMLO announced plans for price pact with businesses last week
Mexico's President Andres Manuel Lopez Obrador
Photographer: Alejandro Cegarra/BloombergThis article is for subscribers only.
Mexico’s government should be very careful if using price controls, which usually can’t curb inflation for long periods of time, according to deputy central bank governor Jonathan Heath.
Bloomberg News reported last week that President Andres Manuel Lopez Obrador was seeking a pact with major businesses to rein in prices that are rising at the fastest pace in two decades. Heath welcomes “out-of-the-box” thinking and it is in the government’s right to use such controls, he wrote on Twitter on Tuesday.