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Scotiabank Saying Managing MXN Volatility With Uncertain Fed Outlook Adds Caution

MEXICO
  • An unchanged decision would extend the hold that has been in place since the last hike back on March 30th. Inflation has continued to make progress with September’s core reading falling to 5.8% y/y from a peak of 8.5% a year ago.
  • That hasn’t only been driven by year-ago base effects either, as month-over-month core inflation has been cooling through a series of softer than seasonally normal increases in seasonally unadjusted core inflation since Summer.
  • Managing peso volatility in the face of an uncertain Fed outlook adds caution.

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