The Bank of Mexico (Banxico) has reduced its benchmark interest rate by 25 basis points to 7.75%, effective August 8, 2025. This decision marks a moderation in the pace of monetary easing after four consecutive half-point cuts earlier in the year. The move was widely anticipated by market analysts and reflects a response to a deceleration in inflation, which stood at 3.51% in July. The rate cut was decided by the Governing Board with a divided vote, including members Victoria Rodríguez Ceja, Galia Borja Gómez, and José Gabriel. Banxico's adjustment aims to balance ongoing economic weakness and uncertainty stemming from trade tensions with the United States. The lowered interest rate, the lowest in three years, is expected to impact credit and savings for Mexican consumers, with the central bank indicating there remains room for further reductions in the future. Inflation forecasts have been revised downward overall, although short-term core inflation projections have been adjusted upward due to a rebound in goods and services prices.