Mexican Finance Minister Jose Antonio Meade said uncertainty over relations between the U.S. and Mexico presents challenges for the country's economy and currency, particularly as tighter monetary policy "isn't helping Mexico to grow."
The Mexican central bank has been raising rates for more than a year, in step with a tightening cycle its U.S. counterpart began in late 2015. At a policy meeting last month, Mexican central bankers raised the overnight interest-rate target by a quarter percentage point to 6.5%, and debated whether further increases by the Federal Reserve should prompt an automatic response in Mexico.
Mr. Meade said there is "room to improve" the North American Free Trade Agreement, and that Mexico is ready to "constructively engage" with the U.S. on Nafta, at an event at the Washington-based Center for Strategic and International Studies during the International Monetary Fund's spring meetings.
"If we aim to do too much in terms of putting rigidities in the North American integration structure, we risk losing North American value chains to outside of the region," he said.
This week, U.S. President Donald Trump reiterated his threat to eliminate Nafta if it can't be altered. The comments sent Mexico's currency almost 1.5% lower against the dollar to a near two-week low.
Write to Harriet Torry at firstname.lastname@example.org
(END) Dow Jones Newswires
April 21, 2017 16:29 ET (20:29 GMT)