Mexico’s central bank signaled that it needs to see clearer evidence of disinflation before it can join the regional trend for interest rate cuts.

Consumer demand and the jobs market remain strong, and inflation risks are “biased to the upside”, policymakers said in the minutes to their Nov. 9 meeting published Thursday.

“Despite the progress in disinflation, the outlook continues to be challenging”, central bankers wrote.

Inflation expectations remain above target, and service price rises still aren’t showing a “clear downward inflection point,” they added.

Mexico left its benchmark rate at 11.25% in November. Elsewhere in the region, Brazil, Peru and Chile have all started easing policy as inflation slows toward target following its post-pandemic spike.

Policymakers tweaked the post-meeting statement to say they intended to hold borrowing costs at the current level “for some time” — ditching the expression “for an extended period” they had employed in the previous four meetings.

Deputy governor Irene Espinosa argued against this change in forward guidance, saying that the tight labor market and persistent core inflation mean increased inflation risks.

Inflation Outlook

One member said that monetary policy should remain cautious and act gradually.

“Depending on the evolution of the inflationary outlook, a cycle of continuous decreases would not necessarily take place,” the member said.

Read More: Mexico Signals Forthcoming Cut After Keeping Rate Unchanged

While annual inflation has ticked up, core measures excluding energy and food costs are slowing. Consumer prices rose in line with expectations to 4.3% in early November, according to official data published earlier on Thursday. Still, price pressures remain above the central bank’s 3% goal.

Read More: Mexico’s Inflation Ticks Up as Banxico Holds Key Rate Steady

Banxico, as its central bank is known, usually follows more closely the move of the Federal Reserve, which is still deciding when to start its easing cycle.

(Updates with deputy governor Espinosa’s remarks in 9th paragraph)