UPDATE 1-Mexico's central bank boss says no rate cut yet

Mon Jan 21, 2013 9:54pm EST

MEXICO CITY Jan 21 (Reuters) - Mexican central bank chief Agustin Carstens said on Monday it was still not time to lower interest rates in the country, adding that the peso currency was still relatively well anchored on economic fundamentals.

"It is not yet appropriate to reduce rates," Carstens said in an interview with Radio Formula. "However, there are some factors that have been occurring and if they continue (and) consolidate, that could lead us to take that step."

"It is a decision that we have to take with a lot of care."

Mexico's central bank held borrowing costs steady last week, but said it could cut rates if inflation continued to cool and economic growth slowed, dropping its recent threat to tighten monetary policy

The Mexican peso weakened for a second straight session on Monday as investors speculated about a possible interest rate cut by the central bank.

Mexico's peso slipped 0.6 percent to 12.69 per dollar on Monday after hitting a 10-month high last week before the central bank raised the possibility of scaling back the rate.

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