Inflation latest publications
In November, the Consumer Price Index increased by 0,52%. With this outcome, inflation increased from 1,7% in October to 2,1% in year on year terms, mainly explained by supply factors.
U.S. battening down the hatches after exiting eye of the storm. Fed pause a precursor to further action? Auto sales outlook: health concerns at the wheel. Housing market conditions and outlook.
The decision might not mark the end of the rate cut cycle if with falling inflation Banxico resumes it in 2021. Banxico reasons for pausing not clear in the statement.
In October, the Consumer Price Index increased by 0,02%. With this outcome, inflation in year-on-year terms fell from 1,8% in September to 1,7%, thus remaining relatively stable in recent months.
The rebound in economic activity in 3Q20 has been higher than expected, although the pace will slow due to weak in domestic demand and a slowdown in external demand. We continue to anticipate a slowdown in inflation and lower interest rates, however we now expect these lower levels to be delayed a few months.
Pandemic and election could add noise to short-term outlook, but medium-term prospects improving. Baseline assumes GDP growth of -4.6% in 2020 and 3.8% in 2021. Pace of decline in unemployment to slow as persistent headwinds increase.
Following the impact of the measures adopted to contain COVID-19, economic activity has recovered faster than expected, although the normalization is losing momentum. We expect GDP to contract by 13% in 2020 and to rebound next year by 10%, following the general election and the availability of a vaccine or viable treatment
The Chinese economy has continued the V-shape recovery due to its "first-in, first-out" of the Covid-19 pandemic, with Q3 GDP picked up significantly to 4.9% y/y from 3.2% y/y in Q2. Meanwhile, the uneven feature of recovery that the demand side lags behind the supply side is significantly mitigating.