(Bloomberg) -- Paraguay’s central bank cut its benchmark interest rate by a quarter of a percentage point to 6.5%, slowing its easing pace while saying that borrowing costs are approaching a neutral range.

Friday’s decision to lower the key rate by 25 basis points followed two consecutive half-point cuts in November and December. The move was widely expected by analysts surveyed by the central bank.

Policymakers said in a statement that they will monitor domestic and international events to ensure inflation converges with the 4% target.

Read more: Paraguay Central Bank Sees Rates Reaching Neutral Level in 2024

Central banks across Latin America are reducing borrowing costs thanks to slowing inflation. Mexico remains an outlier, with its central bank keeping its policy rate unchanged at 11.25% since April as the pace of consumer price increases remains above target.

Paraguay’s inflation accelerated to 3.7% in December, led by rising prices for services and food.

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