MEXICO CITY (Reuters) - Mexico's central bank will likely cut its key interest rate again later this week to alleviate the impact of the coronavirus pandemic on the economy, while inflation remains contained, a Reuters poll showed Monday.
Some 26 of 27 analysts predicted the Bank of Mexico's board would cut the benchmark interest rate by 50 basis points to 5.00% when it meets for its next monetary policy meeting on Thursday. One forecast a cut of 25 points.
Reducing the rate to 5.00% would take it to the lowest level since September 2016 and mark a ninth consecutive cut.
By the end of 2020, the median forecast of analysts was for the key rate to be 4.50%. That was below a year-end prediction for 4.75% made in the previous monetary policy survey in May.
Mexico entered a recession in 2019 and the economy is expected to shrink by up to 10% or more this year. Industrial output suffered a record contraction in April, declining by more than 25% compared to the previous month.
Further bolstering the case for a rate cut is the fact inflation remains below the central bank's 3% target. In May, the rate picked up less than forecast to 2.84%.
The central bank is due to publish its latest monetary policy decision on Thursday at 1300 local time (1800 GMT).