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Banxico Rate Decision Due In One Hour (1900GMT/1400ET)

MEXICO
  • Most analysts expect the overnight rate to remain unchanged at 11.25%, with only a few seeing the chance of a 25bp cut. The focus will be on the forward guidance, with market participants looking for any change that opens the door to a possible move in March.
  • The full MNI Banxico preview with analyst views is here: https://roar-assets-auto.rbl.ms/files/59875/MNI%20Banxico%20Preview%20-%20February%202024.pdf
  • Consistent with generalised FX weakness across the region today, we are seeing some pressure on the Mexican peso ahead of the policy rate decision, with USDMXN extending fresh session highs in recent trade to 17.16 just before the US 30-yr auction results. Spot stands around 0.5% higher on the day but overall, price remains well within the short-term technical parameters, which appear well defined at the 17.00 handle and 17.5653, the Dec 5 high.

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