Inflation latest publications
The DANE published the inflation figure for the month of July, with a variation of 0.22% above that anticipated by analysts. With this figure, annual inflation reached 3.79%, already very close to the ceiling of the target range defined by the Issuer. On the other hand, the exchange rate returned to historical highs.
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.
As we expected, the Fed lowered its benchmark interest rate by 25bp to 2-2.25%, citing “implications of global developments for the economic outlook as well as muted inflation pressures” as the reason for cutting.
Last week China’s government announced its GDP figures in the second quarter as well as a batch of activities indicators in June such as industrial production, retail sales and fix-asset investment. These headline figures still look fine.