MEXICO CITY (AP) — Mexico's central bank has raised its benchmark interest rate a quarter-point to 7 percent in an effort to limit inflation.

The country's medium-term inflation target is 3 percent, but prices have been rising recently at an annual rate of 6 percent.

Treasury Secretary Jose Antonio Meade says two further increases are possible as the Bank of Mexico seeks to slow inflation below 4 percent by 2018.

The central bank's Thursday statement cites external risks to Mexico's economy such as uncertain U.S. policies, geopolitical tensions and weak oil prices. Nevertheless, it expresses confidence in the strength of the global economy for the rest of 2017 and 2018.

The hike comes just eight days after the U.S. Federal Reserve raised its key interest rate from 1 percent to 1.25 percent.