Since December 2015, the policy interest rate has been raised four times for a total of 175 basis points, to 4.75 percent, a level just above that in the second half of 2009, in the wake of the global financial crisis. These moves should be interpreted as preemptive, in full view of the fact that monetary policy exerts its full effects with lags.
One central objective has been to avert deviation of inflation expectations from the target due to pass‐through. The Bank of Mexico does not target any exchange‐rate level. However, exchange‐rate developments are taken into account to the extent that they may influence inflation and expectations.