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January 2008 - Present. Interest rate operational target

Banco de México implements monetary policy using a target for the overnight interest rate charged in the interbank market. The current interest rate target regime became effective on January 21, 2008, and substituted the regime based on daily balances known as the “corto.” With the rate target regime, open market operations aim to provide the incentives for banks to keep their accounts at the central bank with a balance of zero at the daily market closing, in an environment where the overnight rate equals the target rate. Banco de México provides or withdraws liquidity as needed to meet its target rate through these operations. Positive balances in the accounts kept by the banks at the central bank are not paid interest, while overdrafts or negative balances are charged twice the overnight interest rate target.