Publications

We expect the Fed to leave rates unchanged at this week’s meeting and do not anticipate growing dovish support. The uncertainty over the end level of tariffs and its inflation impact, along with a still solid labor market, give the Fed room to wait.

A global reserve currency is not just a symbol of power: it is the functional backbone of the international financial system. It is used to set prices, settle transactions, issue debt and, above all, provide liquidity. So what would happen if it didn’t exist?

The recent appreciation of the euro against the dollar—more than 10% since the lows at the beginning of the year—has shifted the price competitiveness of Spanish companies and the purchasing power of households.

At its July meeting, the Central Bank's Board held its benchmark interest rate at 4.50%. In real terms, the rate remains close to the neutral rate.

The impact of geopolitical risks on economic phenomena is undeniable, and demand for research in this field is steadily increasing from governments, regulators, the private sector and multilateral institutions.

The upcoming minutes will be key to gauge to what extent most members remain focused on the weak growth outlook and how confident they are that the current degree of monetary restriction remains inconsistent with prevailing conditions and risks.

Despite core inflation breaching Banxico’s tolerance band, most Board members are likely to remain forward-looking, as weakening domestic demand is expected to continue weighing on consumption and therefore support a downward trend in services inflation.

We identify the main drivers of key financial market asset price dynamics, including the Euro-dollar exchange rate and the Bund-US Treasury yield spread, using a sign-restricted SVAR model. The model also facilitates the extraction of a high frequency global macro-financial conditions indicator.