- Banco de México will hold its monetary policy meeting on Thursday. We expect that the Board will vote to maintain the pause and that the communication will be in line with its previous statement.
- July inflation: Various seasonal factors and changes in commodity prices pushed upwards inflation in July but we expect that most of these effects will be short-lived. The remainder of the year we expect inflation prints in line or slightly above their long term-average. We stand pat on our view that inflation will end the year around 4.6% YoY and core inflation at 4.8% YoY, currently we see the risks to our forecast fairly balanced.
- Last Monday we published “Mexican GDP: seven quarters of robust growth” as 2Q23 data confirmed that the economy maintains its momentum.
- We also published “1Y/1Y vs. 1Y TIIE spread: another way to play the easing cycle”. We see room for Banxico to start cutting rates in 4Q23, so se remain constructive on the short end of nominal curves. In the TIIE curve, we still see more value in the 13X1 TIIE vs the 26x1 slope and the 2-3Y tenors of MBonos.
- The MXN has recently neared 16.60, maintaining its positive momentum. We expect the MXN to remain relatively anchored in 3Q23. Nonetheless, we stand pat on our view that the currency will depreciate towards the end of the year and particularly in 2024. See our most recent note on the MXN.
Credit:
- Pemex (B1/BBB/B+) would rollover bank funding
- Alpek (Baa3/BBB-/BBB-) refinanced a bond debt of USD 200mn with a sustainability loan.
- Auto-loan financial subsidiaries 2Q23