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Free AccessSell Side Sees More to Come Following Banxico Hike
- The Banxico raised rates to 4.75% from 4.50% yesterday, alongside analyst expectations. The Bank cited above-target inflation, pressures emanating from Fed monetary policy and a need to prop up the Peso. Sell-side analysts see further policy tightening going forward, with JPM forecasting two further 25bps raises this year.
- Banxico raised their inflation forecasts to 6.2% at Q4 this year, with upside pressures seen keeping the rate above target until Q3 2023 - a delay of six months from their prior forecast.
- Elsewhere, AMLO confirmed that constitutional electricity reform was sent to Congress yesterday, the latest in the government's attempt to prioritise state-owned utilities over private companies.
- PMI data crosses later today, with markets expecting both manufacturing and non-manufacturing activity to have picked up across September in the IMEF data. The central bank economist survey is also due.
- MXN trades slightly firmer against the greenback at typing, although USD/MXN was bid overnight to touch a new multi-month high of 20.7288.
To read the full story
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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.