Mexico's central bank said the greatest risks to the country's economy and financial system stem from the debt crisis in Europe and its possible contagion to international markets, as well as a potential slowdown in U.S. growth.

In its latest financial report released Tuesday, Banco de Mexico said the risk scenario for Mexico's economy and its banking system "deteriorated significantly during the first nine months of 2011."

The most significant risks for Mexico's financial system "arise from two fronts": the euro-zone debt crisis and the possible deceleration of the U.S. economy, the central bank added, calling on authorities to remain vigilant for possible "threats to financial stability."

A deterioration of the European sovereign-debt crisis could affect the solvency and liquidity of the European banking system and the countries with weak fiscal positions.

"This scenario could create situations of illiquidity and interruptions to the normal functioning of international financial markets," Banco de Mexico said.

"Greater uncertainty and intensification of the risk perception" would aggravate the euro-zone crisis and could lead to "a significant rollback in the flow of capital to emerging markets," the report said.

The bank also pointed to the negative consequences that a further slowdown in U.S. gross domestic product would have on the Mexican economy.

Data on U.S. economic growth in the third quarter is due out this week and most analysts are expecting GDP expansion of around 2,8 percent, or more than double the 1.3 percent growth rate in the second quarter.

The central bank stressed that Mexico has pursued "prudent and responsible" fiscal and monetary policies and that the country's financial system is solvent and profitable, noting that it was capable of absorbing the effects of the 2008-2009 global recession in its most critical moments.

Mexico's fiscal deficit in 2010 was equivalent to 0.4 percent of GDP and authorities expect the economy to grow 3.5 percent this year and 3.3 percent in 2012.

Nevertheless, the central bank warned that stability and confidence are necessary conditions but are "not sufficient to guarantee sustained and rapid growth" and therefore stressed the "urgency" of advancing on pending structural reforms.

The goal of the reforms must be to spur private investment to create "permanent and well-paid jobs," as well as to channel resources to more productive uses, Banco de Mexico said.