By Juan Montes
MEXICO CITY -- The Bank of Mexico raised interest rates by a quarter percentage point Thursday after a six-month pause, as policy makers have grown increasingly worried about high inflation.
The overnight interest rate target now stands at 7.25% -- the highest since February 2009.
The policy meeting marked Alejandro Díaz de León's first as the central bank's governor. He took over two weeks ago facing a tough situation, with high inflation, slowing economic growth, and a weak and volatile peso.
The rate move was increasingly expected by markets and analysts in recent weeks as annual inflation came in above expectations in November at 6.6%, more than double the bank's 3% target.
The Bank of Mexico had been expecting inflation to start to slow at the end of the year.
The U.S. Federal Reserve's rate increase this week also left Mexico's central bank little maneuvering room.
Write to Juan Montes at [email protected]