MEXICO CITY (Reuters) -The Bank of Mexico held its benchmark interest at 11.25% on Thursday as expected, underscoring it will likely maintain the reference rate at its current level for "some time," reflecting a moderation in language from its previous statements.
The decision by the central bank's five-member board to hold the key lending rate steady for the fifth consecutive time was unanimous.
Following the announcement from Banxico, as the monetary authority is known, the peso currency took a slight hit, weakening over 1%.
All analysts polled in a Reuters survey expected the central bank to hold the interest rate at its current all-time high of 11.25%. The rate has sat steady since March, following the central bank's rate-hiking cycle that began in June 2021.
In a statement, the bank said that expectations for headline inflation remained unchanged from its last monetary policy meeting in September.
The bank maintained a previous forecast that inflation will converge to its target in the second quarter of 2025.
"In order to achieve an orderly and sustained convergence of headline inflation to the 3% target, the reference rate must be maintained at its current level for some time," the bank said.
The language marks a subtle change from previous rate decisions that forecast the rate's hold "for an extended period."
"Although the outlook remains complicated, progress on disinflation has been made," the bank said.
The decision "sprung no surprises," concluded Capital Economics' Jason Tuvey, but the tweaks in Banxico's language hinted at a slightly less hawkish stance.
"It looks like officials may be starting to contemplate the start of an easing cycle," Tuvey wrote in a note.
Inflation has been steadily declining in Latin America's second-largest economy, with data earlier in the day showing inflation easing in October for the ninth consecutive month.