Banxico seen on hold this week – BBH

In view of Analysts at BBH, the Mexican central bank – Banxico – is expected to keep its monetary stance unchanged at this week’s meeting.

Key Quotes

“Banco de Mexico meets Thursday and is expected to keep rates steady at 6.5%. Some look for another 25 bp hike, however”.

“April CPI rose 5.8% y/y, the highest rate since May 2009 and further above the 2-4% target range”.

“While further tightening would seem warranted, we think Banxico will remain on hold now. If the Fed hikes in June and price pressures are still rising, then a hike at its June 22 meeting seems likely”.