Macroeconomic Forecast MexicoNovember 2010 | Macroeconomic Forecasts
BMI View: Mexico's monetary authorities continue to reinforce their defences against another sovereign shock, by building up foreign reserve levels to a record US$111bn by October 2010. In line with Central Bank Governor Augustín Carstens' stated aim of reducing the economy's reliance on external support - such as the IMF flexible credit line and US Federal Reserve swap facilities which were extended in 2009 - we expect the authorities to continue increasing reserves as long as upside pressure remains on the currency. At present we are pencilling in reserves to reach US$116bn by end-2010 and US$125bn by end-2011, and while we are reasonably confident about our 2010 projection, our 2011 forecast will depend largely on how global markets respond to US quantitative easing.
To read the full article, please choose one of the following options: