Hence, it is likely that additional expansionary measures will be undertaken given the already anemic pace of economic recovery in those countries. The implication for Mexico is that capital inflows will probably continue for some time. However, as history has taught us time and again, any financial bonanza eventually ends.
This lesson should keep us prudent and alert to possible excessive risk-taking in the domestic financial system. Inflation and monetary policy After having declined in the previous two years, since the middle of 2011 annual inflation has been rising. Last June, it surpassed the upper limit of the variability interval around the Bank of Mexico’s 3 percent target, reaching 4.3 percent.