Mexico is coping with challenges domestic and foreign, economic and political. The Mexico peso has been on a roller coaster, but the Mexican economy is growing reasonably well despite turbulence in oil markets and rising inflation. It has also remained strong in the face of a populist challenge to the incumbent president’s party and Donald Trump’s vow to renegotiate the North American Free Trade Agreement and “build a wall” on the border. At the same time, the U.S. Federal Reserve’s plans to gradually raise short-term interest rates will have spillover effects for all emerging markets, Mexico included. How will Mexico’s economic policymakers approach all these challenges, as well as threats to financial stability around the globe?
On April 20, the Hutchins Center on Fiscal and Monetary Policy hosted Agustín Carstens, governor of the Bank of Mexico, to discuss these questions at the National Press Club. Governor Carstens has been Mexico’s central banker since January 2010 and has announced plans to step down later this year to become general manager of the Bank for International Settlements in Basel, sometimes called the central bankers’ central bank.
Following his remarks, Governor Carstens fielded questions from David Wessel, director of the Hutchins Center, and from the audience.
“The 21st century has revalued these small geographies. That’s what the 21st century demands,” Katz said, noting that these days, “[w]e aren’t innovating in isolated business parks” in the suburbs.