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VIEW: HSBC "expect that the expected sharp...>

MEXICO
MEXICO: VIEW: HSBC "expect that the expected sharp contraction of the economy
and temporarily lower inflation will provide more room to Banxico to cut rates
further, in our view. Nonetheless, we think that Banxico will remain reluctant
to cut rates more aggressively, mainly due to the persistent inflation risks,
including: a low comparison base, the currency weakening, deteriorated public
finances and other structural risks. In fact, our inflation forecast for 2021
stands at 3.6%, but the materialization of any of these could take inflation
back to levels around 4% in 2021. We expect the terminal rate at 5.0%."
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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