Tuesday, 15 October 2013 01:10
BY MAURILIO SOTO
TheNews.com
President Enrique Peña Nieto said Monday that the Mexican Central Bank (Banxico) has been successful in controlling inflation, prices, bank commissions and interest rates over the 20 years since it was granted autonomous decision-making powers.
According to Peña Nieto, when the Mexican Constitution was modified in August 1993 to grant Banxico autonomy from the federal government, the primary goal was to stabilize the peso following 20 years of inflation and economic crises.
Banxico has been successful in this goal, he said, as inflation has averaged 9.9 percent over the past 20 years, compared to the 45 percent average inflation seen in the 20 years prior to 1993. Peña Nieto said that these convincing results have ensured that the Mexican financial system has become “one of the most robust, solvent and liquid in the world.”
Banxico Chairman Agustín Carstens said that in the years before the central bank was granted operational and decision-making independence, Mexicans often suffered from the effects of macroeconomic shocks. “They lived through intense and prolonged periods of high inflation, extensive poverty, cancelled investment projects and savings that were lost in a matter of months,” Carstens added.
The youngest generation in Mexico has never had to face these problems, Carstens said. “Today, more than 32 million Mexicans have never lived through annual inflation exceeding single digits, they don’t know the ravages of high inflation and instead benefit from the country’s macroeconomic stability,” he added. “Today thousands of Mexicans have access to mortgages with payment terms of up to 30 years. This was simply unthinkable in 1993.”
Peña Nieto said that the financial reform proposal he presented to Congress earlier this year would further expand access to credit and stimulate the economy. Thanks to the country’s healthy financial policies and the hard work of Banxico, he added, the country is ready for further growth.
“This would give the country a new, long-term stimulus to increase and democratize productivity, create the jobs that Mexicans demand and, above all, improve the quality of life for all the country’s population,” Peña Nieto said.
TheNews.com
President Enrique Peña Nieto said Monday that the Mexican Central Bank (Banxico) has been successful in controlling inflation, prices, bank commissions and interest rates over the 20 years since it was granted autonomous decision-making powers.
According to Peña Nieto, when the Mexican Constitution was modified in August 1993 to grant Banxico autonomy from the federal government, the primary goal was to stabilize the peso following 20 years of inflation and economic crises.
Banxico has been successful in this goal, he said, as inflation has averaged 9.9 percent over the past 20 years, compared to the 45 percent average inflation seen in the 20 years prior to 1993. Peña Nieto said that these convincing results have ensured that the Mexican financial system has become “one of the most robust, solvent and liquid in the world.”
Banxico Chairman Agustín Carstens said that in the years before the central bank was granted operational and decision-making independence, Mexicans often suffered from the effects of macroeconomic shocks. “They lived through intense and prolonged periods of high inflation, extensive poverty, cancelled investment projects and savings that were lost in a matter of months,” Carstens added.
The youngest generation in Mexico has never had to face these problems, Carstens said. “Today, more than 32 million Mexicans have never lived through annual inflation exceeding single digits, they don’t know the ravages of high inflation and instead benefit from the country’s macroeconomic stability,” he added. “Today thousands of Mexicans have access to mortgages with payment terms of up to 30 years. This was simply unthinkable in 1993.”
Peña Nieto said that the financial reform proposal he presented to Congress earlier this year would further expand access to credit and stimulate the economy. Thanks to the country’s healthy financial policies and the hard work of Banxico, he added, the country is ready for further growth.
“This would give the country a new, long-term stimulus to increase and democratize productivity, create the jobs that Mexicans demand and, above all, improve the quality of life for all the country’s population,” Peña Nieto said.
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