The Mexican Banking Association “sees no risk” in Banxico's autonomy

The Mexican Banking Association (ABM) said Thursday that it “sees no risk” in the autonomy of the Banco de México (Banxico) following the controversy created by President Andrés Manuel López Obrador, who unprecedently advanced the central bank's monetary decision.

During the opening of the 85th Banking Convention being held in Acapulco, ABM leader Daniel Becker expressed his confidence in the new governor of Banxico, Victoria Rodríguez Ceja, appointed by López Obrador.

“He has clearly indicated and expressed to us the autonomy given to him by both the president, the federal government, and his support of the Governing Board, and we see no risk of losing any kind of autonomy with the new governor,” Becker said.

The initial press conference of the Banking Convention was marked by the controversy of López Obrador, who at his morning press conference this Thursday revealed that Banxico decided to raise the interest rate by 0.50 points (50 basis points) to put it at 6.5%.

“The decision of the Banco de México yesterday (Wednesday) was taken unanimously, and we respect the decision of the Banco de México,” López Obrador said at his morning conference at the National Palace, breaking all precedents.

After the president's revelation about the Banxico decision, experts, politicians and economists condemned the fact.

“I can't believe the president announced Banco de México's rate decision!! I'm still in shock. And autonomy? And the governor? And the institutions? Yes... I know that the latter is rhetorical, but the other two questions there were those who still said that everything was ok,” Valeria Moy, director of the Mexican Institute of Competitiveness (IMCO), wrote on her Twitter account.

For her part, Gabriela Siller, Director of Economic Analysis at Grupo Financiero Base and professor of economics at Tecnológico de Monterrey, wrote: “The president revealed what Banco de México will announce today. @Banxico is self-employed and this is seen as a scandal. Never before has a monetary policy decision been leaked in Mexico and the fact that the president does so generates concern for the autonomy of the central bank” (sic), he said.

At the insistence of the press that he is at the 85th Banking Convention, the leader of the ABM argued that in the association “he will not comment on things that they are not sure about.”

“What we could say about this is that we are very respectful of the central bank's autonomy,” he said.

“We should only add more than to say that ABM has always been and has been very vocal in the sense of the importance of having a central bank with a mandate for price stability,” he concluded.

Banxico's decision - which will be officially announced this Thursday afternoon - represents the seventh consecutive increase in the rate and the third in a row of 50 basis points.

The last time it went up was on February 10, in the debut of Governor Rodríguez Ceja.

Raúl Martínez-Ostos, vice president of the ABM and president of Barclays, also expressed his confidence in Banxico, arguing that it is a collegiate body that does not depend solely on Rodríguez Ceja.

“We saw in the first announcement by the Banco de México, with the new governor, a clear signal that legitimizes the autonomy and plurality of the junta. Then, without a doubt, and we saw it with the response of the markets, it was very well taken by the markets, and we hope that this will continue,” he said.

It should be recalled that President Andrés Manuel López Obrador has appointed four of the current five members of the Governing Board, including Victoria Rodríguez Ceja, despite not having experience in monetary policy.

With information from EFE

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