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Economy / Mexico


August 2012 | Data Release

The release of the Banco de México (Banxico)'s July 20 monetary policy meeting minutes supports our forecast that the bank will hold the policy rate at 4.50% throughout 2012, with easing to start in 2013. Mexico's growth story has proven fairly resilient in the year-to-date, with the IGAE (economic activity index) recording an average expansion of 4.57% y-o-y between January and May, and the goods trade account continuing to post surpluses on the back of robust US demand for autos. This implies little need for immediate action to bolster growth. Indeed, the July communiqué suggested that in the short term, the bank was far more concerned with elevated supply-side inflationary pressures, especially with grains prices still near record levels.

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