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23 Apr 2013
Forex Flash: Mexican Central Bank expected to hold rates - BBH
FXstreet.com (Barcelona) - Brown Brothers Harriman analysts note that the Mexican central bank meets Friday and is expected to keep rates steady at 4.0%.
Ahead of that meeting on Wednesday, mid-April CPI report is due out and is likely to show still-elevated price pressures. They feel that due to low base effects, the y/y headline rate is seen jumping to 4.8% y/y from 4.1% y/y in mid-March. However, they write, “Core CPI is seen remaining steady at 3% y/y. For now, high inflation should squelch any thoughts of a follow-up rate cut anytime soon. We see steady rates for the rest of 2013, unless the economy shows signs of a much sharper slowdown.”
Ahead of that meeting on Wednesday, mid-April CPI report is due out and is likely to show still-elevated price pressures. They feel that due to low base effects, the y/y headline rate is seen jumping to 4.8% y/y from 4.1% y/y in mid-March. However, they write, “Core CPI is seen remaining steady at 3% y/y. For now, high inflation should squelch any thoughts of a follow-up rate cut anytime soon. We see steady rates for the rest of 2013, unless the economy shows signs of a much sharper slowdown.”