FXStreet (Edinburgh) – Analysts at BBH noted this week’s central banks meetings in the LatAm space.
Key Quotes
“Brazil central bank meets Wednesday and is expected to hike rates 50 bp to 14.25%… Price pressures continue to build, and will keep pressure on the central bank to continue hiking rates”.
“Mexico central bank meets Thursday and is expected to keep rates steady at 3.0%. Mid-July CPI came in lower than expected at 2.76% y/y vs. 2.87% consensus. This was the lowest since at least 1989, and moves further below the 3% target. Real sector data remains fairly soft. Under these conditions, we do not expect Banco de Mexico to make good on its intent to hike rates this year”.
“Colombia central bank meets Friday and is expected to keep rates steady at 4.5%. CPI rose 4.4% y/y in June, above the 2-4% target range. The economy remains soft, but high inflation and a weak peso have tied the central bank’s hand for the time being. Lower oil prices will continue to weigh on the economy. Officials do not seem concerned by the weak peso, which is trading lows not seen since 2003. There is risk of inflation pass-through as weakness continues”.
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