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.
MNI Banxico Preview - June 2024
Executive Summary
- Most analysts expect Banxico to keep its overnight rate unchanged at 11.00%, with some seeing an outside chance of a 25bp cut.
- Post-election market turbulence, the sharp depreciation of the peso and a cautious Fed skews the risks firmly towards another hold.
- However, with the minutes of the May meeting suggesting a June adjustment may be considered, the downside surprise for core CPI in May and the high level of restrictive policy, Thursday’s decision is not set in stone.
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MNI Banxico Preview - June 2024.pdf
Election Reaction Raises Prospect of Extended Pause to Easing Cycle
After pausing its short-lived easing cycle at 11.0% in May, policymakers kept the door open to further easing, with Governor Rodriguez saying that the central bank could consider further cuts in the reference rate in the coming meetings, depending on the incoming inflation data. She noted that services inflation is higher than expected, but that the Bank was evaluating how slower growth early this year would impact its overall growth forecast. Since then, however, the strong market reaction to the presidential election result and concerns over potential judicial reform has prompted market participants to reassess rate cut projections, with many no longer expecting a move this week.
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.