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Banxico Decision Due At 2000BST/1500ET

MEXICO
  • 19/24 analysts surveyed by Bloomberg believe Banxico will keep the overnight rate unchanged at 11.25%. However, the remaining five are forecasting a 25bp increase. Broad greenback strength in recent sessions has prompted a firm bounce for USDMXN, rising to a high of 17.7397 overnight. Initial resistance is at 17.7735, the 20-day EMA.
  • Slowing headline, and core inflation, will aide some policymakers in believing the tightening cycle should conclude. However, the stickiness of wages, the jobs market and growth will prevent the bank from calling an end to further rate rises ahead.
  • Full preview including summary of sell-side views here: https://roar-assets-auto.rbl.ms/files/52935/MNI%20Banxico%20Preview%20-%20May%202023.pdf
  • Additionally, Deputy Finance Minister Gabriel Yorio and Julio Carranza, head of Mexico’s bank lobby ABM, speak at an ABM event on financial education.

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