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Goldman Sachs On Banxico Minutes

MEXICO
  • As in previous occasions and given the split vote, GS expect the minutes to show significant dispersion of views among directors around the outlook for inflation, the balance of macro and financial risks, and how conservative the monetary stance should be.
  • They will be paying particular attention to the discussion among directors of the monetary policy outlook and whether the June surprise rate increase is likely to be followed up by additional hikes, or whether it is potentially just a one (possibly two) hike(s).
  • Will examine any discussion about the relevance and implications for domestic monetary policy setting of the recent changes in guidance, and in some places policy rates, in several EM and DM economies.
  • Also look at the committee's views on real business cycle dynamics, the solid and stronger than expected performance of the economy during 4Q2020 and 1Q2021, and outlook for the remainder of 2021 given the supportive external backdrop and with Mexico particularly levered to an upbeat US growth (and US fiscal) outlook.

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