Mexico: Selected Issues
Electronic Access:
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Summary:
This Selected Issues paper analyzes transmission of monetary policy rates to lending and deposit rates in Mexico. The results show that transmission of the policy rate to market rates is statistically significant in all cases, except for mortgage rates. For sight deposits, pass-through is low, with a 1 percentage point increase in the policy rate leading to a 0.2 percentage point rise in the deposit rate. For term deposits the pass-through is stronger, but remains below unity at 0.7. The pass-through to both lending and deposit rates is very rapid. The dynamic specifications show that pass-through is significant in either the current or the following month, and the long-term impact is achieved during the second month.
Series:
Country Report No. 2016/360
Subject:
Central bank policy rate Deposit rates Financial institutions Financial regulation and supervision Financial services Hedging Oil prices Options Prices
English
Publication Date:
November 22, 2016
ISBN/ISSN:
9781475556032/1934-7685
Stock No:
1MEXEA2016003
Pages:
37
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