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MEXICO CITY — Mexico’s central bank is expected to raise its benchmark interest rate for the third time in a row at its next monetary policy meeting on Thursday, as inflation stays well above policymakers’ target level, a Reuters poll showed on Monday.

All 22 analysts surveyed said they expect the Bank of Mexico to raise the rate by 25 basis points to 4.75%.

Known as Banxico, the central bank in August raised the rate by 25 basis points to 4.5% in a bid to contain price pressures, although the vote was divided.

Mexican inflation accelerated faster than expected during the first half of September to 5.87%, prompting expectations of a new rate hike.

Banxico aims for a rate of 3% with a one-percentage-point tolerance threshold above and below that.

Citibanamex said in a report that inflationary pressures are high as price increases continue to surprise on the upside.

Banxico will publish its monetary policy statement on Thursday at 1 p.m. (1800 GMT). (Reporting by Miguel Angel Gutierrez; Additional reporting by Gabriel Burin; Editing by Jonathan Oatis)

Source: https://financialpost.com/pmn/business-pmn/mexicos-central-bank-seen-hiking-interest-rate-to-4-75

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