Interest rates

Interest rates latest publications

September 30, 2021

Sizable upward revision to core inflation forecasts points to more tightening

The tightening cycle will likely continue, but we stick with our more dovish view than priced by markets for 2022 .

July 21, 2021

Mexico Economic Outlook. Third quarter 2021

We upwardly revised the 2021 GDP growth forecast to 6.3% from 4.7%. Banxico will continue increasing the reference rate for the rest of the year unless inflation drops more-than-expected.

April 28, 2021

Fed upgrades its outlook but tapering and liftoff are not in the radar

The Fed acknowledged that economic conditions have improved but the recovery remains uneven and incomplete. As we expected, the Fed left interest rates unchanged, maintained the monthly pace of asset purchases and kept its forward guidance unaltered.

April 21, 2021

Mexico Economic Outlook. Second quarter 2021

Greater economic dynamism due to external impulse and a gradual normalization in 2021. Banxico will remain in a long pause and will not start a cycle of increases until 2023.

March 25, 2021

Mexico | The easing cycle is over

Banxico’s Board kept its policy rate unchanged at 4.0%; the wording signals a shift from a dovish to a cautious tone. All five Board members voted to keep the policy rate on hold.

March 24, 2021

We no longer expect Banxico to cut the monetary policy rate at tomorrow’s meeting

We are changing our call for tomorrow’s MPC decision to pause following today’s unexpected strong core inflation print. Core inflation rose strongly, to 4.1%, in the first half of March.

March 23, 2021

Should Banxico hold the policy rate steady, reacting to a temporary rise in inflation?

We stick with our call of a 25bp rate cut to 3.75%, but the odds became closer, 60-40 leaning to a cut in our view. The MPC should not react to temporary increases of inflation, already acknowledged in its communication and expected by everyone (ie, markets and analysts).

March 17, 2021

FOMC holds the line despite more upbeat outlook

The FOMC made upward revisions to their GDP and inflation outlook and lowered its estimates of the unemployment rate, but kept its projections of the policy rate at the zero lower bound at least until 2023.