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To counter the rise in prices affected by inflation, the Bank of Mexico opted to raise interest rates.
On Thursday, Mexican President Andres Manuel Lopez Obrador (AMLO) hailed the current strength of the Mexican peso against the dollar and declining inflation, saying it was partly due to policies to contain prices.
"We will continue to be careful that inflation does not increase. When there is inflation, income is greatly affected. Salaries can be increased, but if there is a rise in inflation, you lose purchasing power," he said.
To counter the rise in prices affected by inflation, the Bank of Mexico opted to raise interest rates. At the same time, his administration agreed with producers and sellers to offer the basic basket of goods at "fair" prices.
Policies to cap fuel and electricity prices have also helped fight inflation. Currently, the Mexican peso is the "strongest currency in the world against the dollar," which is quoted at 17.55 pesos, the best level recorded since 2016.
Our country is a fabric of immigrants who contribute greatly to our culture, economy, & lives.
Raised by immigrant parents from Mexico, this month is dear to me. Grateful for all who sacrificed for the American dream.
The National Institute of Statistics and Geography (INEGI) reported that inflation was 5.84 percent year-on-year as of May. A report by the Banorte Financial Group noted inflation was below 6 percent for the first time since August 2021.
Between May and April, the inflation of prices for food fell from 12.14 percent to 11.44 percent, while the rate of increase of energy prices fell from 5.48 percent to 4.21 percent.
Mexico closed 2022 with inflation of 7.82 percent, its highest level in two decades. The Bank of Mexico has set target inflation at 3 percent and expects to meet the target by the end of 2024.