The Citibanamex Financial Group on Monday reduced its economic growth forecast of Mexico for 2018 to 2.1 percent from 2.3 percent.

The revision is in line with a lower-than-anticipated Gross Domestic Product (GDP) during the second quarter, which contracted 0.2 percent, according to adjusted figures from the National Institute of Statistics and Geography (INEGI).

?Citibanamex, however, maintains its projection of 1.9 percent economic growth in 2019.

On Aug. 29, Mexico's Central Bank (Banxico) reduced its economic growth forecast for 2018 to between 2.0 percent and 2.6 percent from its previous forecast of between 2.0 percent and 3.0 percent.

In regards to inflation, Citibanamex raised its year-end forecast to 4.5 percent from 4.2 percent earlier.

"When it comes to inflation, we have considered that the pressure from the energy sector will continue for a few more months, which would be reflected in a slower decline of inflation during the final months of the year," said the financial institution in a report to its clients.

In spite of this, the inflation forecast for next year fell to 4.0 percent from the previous 4.2 percent amid expectations of lower economic growth.

Banxico has a permanent inflation objective of 3.0 percent, with a 1 percent differential in either direction.

Mexico's year-on-year inflation rate increased to 4.9 percent in August, which was the highest level in five months, according to the most recent figures available.

Since December 2015, Banxico has raised its key interest rate on several occasions, which led to the cost of credit going from 3.0 percent to the current 7.75 percent.

"We believe the central bank will keep interest rates where they are for the rest of the year and begin lowering them beginning in June 2019," said Citibanamex.

The next meeting of Banxico's governing board is scheduled for Oct. 4.