Banxico latest publications
August 12, 2019
Rate cut is not off the table, but we expect Banxico to hold rates steady one more meeting
Banxico will likely strike a dovish tone to signal that an easing cycle is about to start.
Update of financial savings and financing indicators in Mexico. Credit limit raised by INFONAVIT. Market performance supported by expected interest rate cuts. Reports by Sociedades de Información Crediticia (Credit bureaus). Information received by SIC from financial institutions.
Mortgage lending increased, with higher average amounts and a slight increase in the interest rate. In 2018, payroll loans slowed their growth rate. The Financial System Stability Council (CESF) updates its risk balance. High concentration of demand for bank mortgage loans.
In our view, the start of the easing cycle is likely to come later than warranted. Banxico remained overly hawkish in its quarterly inflation report (yesterday) and in the minutes of the last meeting (16 May) released today.
The CNBV publishes a new financial education indicator. The dynamism in private sector credit in 1Q19 reflects moderation in economic activity. Trade Tensions between the USA and China Increase Risks for Global Growth.
As widely expected, Banxico left the monetary policy rate unchanged at 8.25%. The decision was unanimous, as we anticipated. The wording and tone of the statement remained hawkish and was little changed from the previous one (March 28). As we anticipated, the hawkish tone continues to signal a cautious approach.