MEXICO CITY The International Monetary Fund's executive board has approved a two-year $35 billion flexible credit line for Mexico, it said in a statement on Thursday, noting the Latin American country's economy is undergoing a broad-based expansion.

The Mexican authorities stated their intention to treat the new arrangement as precautionary, the statement added.

This is Mexico's tenth flexible credit line arrangement since 2009, and the country has reduced amounts of the lines granted in recent years, the IMF said.

"Mexico's macroeconomic policies and institutional policy frameworks remain very strong," Gita Gopinath, the IMF's First Deputy Managing Director, said in the statement.

(Reporting by Kylie Madry and Valentine Hilaire)