Workers spray disinfectant along the perimeters of Zocalo Square after Mexico entered what the government calls"Phase 3" of the spread of the coronavirus disease , in Mexico City, Mexico April 21, 2020. REUTERS/Gustavo GrafMEXICO CITY: Mexico will increase spending on social programs and infrastructure projects by US$25.6 billion, President Andres Manuel Lopez Obrador said on Wednesday , in a delayed attempt to jump-start the coronavirus-hit economy.
On Tuesday the central bank unveiled US$31 billion in stimulus and an interest rate cut in support for the financial system, with about a third destined to a financing facility for banks to boost lending. Nikhil Sanghani, an economist at London-based Capital Economics, warned the economy still risked going into a deep recession without greater support.
Lopez Obrador said the package would be financed through spending cuts in non-essential areas and a reduction of up to 25 per cent in high-level bureaucrat's salaries, including his own.Mexico's finance ministry said it placed bonds with 5-year, 12-year and 31-year maturities with yields of between 4.125per cent and 5 per cent.
"This will make it possible to protect 70 per cent of Mexican families, equivalent to 25 million homes, especially the poor and middle class," Lopez Obrador said.
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