MNI BRIEF: BOJ Tankan: Business Inflation Expectations Solid

MNI BRIEF: RBA Details Hypothetical Monetary Policy Paths

MNI: PBOC Net Injects CNY14.2 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Higher At 7.1876 Fri; -1.22% Y/Y

MNI BOJ DEC TANKAN LARGE MFG INDEX +14; SEPT 13; MEDIAN +12

MNI INTERVIEW2: Poland To Push For EU Defence Fund

MNI: UK DEC GFK CONSUMER CONFIDENCE INDEX -17

EZ/UK Bond Supply Calendar: Belgium ORI Facility on Friday

US EIA:NAT GAS STORAGE -190 BCF TO 3,747 BCF DEC 06 WK

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

Commerzbank on Banxico: Concerns Point To More Decisive December Action

MEXICO
  • The fact that President AMLO nominated Victoria Rodriguez, Vice-Minister of Finance, as the future Banxico governor caused upheaval on the financial markets yesterday. The news caused palpable uncertainty on the markets about Banxico's future monetary policy course and the peso eased. USD-MXN briefly shot above the 21.60 mark; levels that were last seen in April 2020.
  • In the challenging global environment and due to a continued rise in inflation rates the President's change of heart comes at a bad moment. MXN investors might fear that the designated Banxico governor does not have the required experience for the position. But above all they could fear for the central bank's sovereignty, as Victoria Rodriguez is seen as a close ally of President AMLO.
  • The fact that the peso was able to retrace some of its losses suggests that, following the initial shock, MXN investors want to wait and see what happens as the Senate has yet to approve the step. If comments on the part of the nominated Victoria Rodriguez or the President were to fuel doubts about the future stability-orientated course of Banxico, the peso would face further painful losses which would further increase price pressure.
  • Against this background, markets are likely to begin focussing on Banxico's December meeting already. From Commerzbank's point of view - concerns about rising inflation expectations in particular point towards Banxico taking more decisive action against high inflation rates.
BulletEM BulletEmerging Market NewsHomepage
BulletEM BulletEmerging Market NewsHomepage

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.