MNI BRIEF: Members See Core Inflation Falling -Banxico Minutes

MNI (BRASILIA) - All Central Bank of Mexico board members agreed that inflation increases in the preceding five months were due to the upward trend of the non-core component, given that core inflation has remained on a downward trend, minutes of the last meeting released Thursday showed.

"Most members mentioned that services inflation continues to show persistence," the document said.

Banxico's August decision to cut its interest rate by 25 basis point, to 10.75%, was split, with Governor Victoria Rodriguez and Deputy Governors Galia Borja and Omar Mejia in favor of the rate cut, while Deputy Governors Irene Espinosa and Jonathan Heath voted to keep borrowing costs at 11%.

Espinosa and Heath argued that the inflationary environment is complex, according to the minutes, with headline inflation continuing to increase consecutively for five months, still far from the target, and that a cut might be interpreted as premature. (See MNI WATCH: Banxico Hints At More Rate Cuts After Split Vote)