MEXICO CITY: Mexican President Andres Manuel Lopez Obrador on Thursday said the Mexican peso's strength is good for the economy but warned, hours before the central bank announces its monetary policy decision, that rising interest rates can hurt the economy.

Lopez Obrador said during a regular news conference he expects to end his six-year term in 2024 without a depreciation of the peso currency, adding he sees the peso trading around 20.20 or 20.30 to the U.S. dollar by that time.

Mexico's peso hit an over 2-1/2 year high in Thursday trading, up 0.8% at 19.41 per dollar.

Mexican peso slides about 1% on worries about slowing economy

"I very much question the fact that everywhere the formula to lower inflation is to increase (interest) rates, but this is inconvenient for the economy because credit becomes more expensive," the left-leaning, populist leader said.

"Growth should not be halted, the important thing is to grow without inflation," said Lopez Obrador, who has often railed against high interest rates.

His remarks come as the Bank of Mexico meets and is widely expected later in the day to

hike its key interest rate by 75 basis points to a record 10% to tame surging inflation.