Banxico: inflation will keep the majority of the Board in a tightening mode

Banxico will likely hike the policy rate by 25bp to 4.75% but looking ahead, we stick with our more dovish view .

Key points

• Key points:
• Continued inflation pressures point to another 25bp rate hike to 4.75% this Thursday
• However, the latest minutes open the door to interpretations that the majority of the Board could soon lean to put an end to the current pre-emptive hiking cycle
• Our bias now is that Banxico will not take the policy rate to 5.0% by year end and we are sticking with a more dovish expectation for 2022

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