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Significance
While inflation is easing in the United States, it is still increasing in Mexico. The US Federal Reserve (Fed) is expected to keep raising its benchmark rate, pushing Banxico to follow suit, to maintain the gap between the rates and avoid pressures on peso-dollar parity.
Impacts
The monetary tightening should have a significant impact on credit, adding to the economic slowdown.
Banxico’s autonomy -- widely respected by the public as a bulwark against inflation -- will not be modified by legislators.
Fiscal policy will remain relatively tight, working against inflation in tandem with the higher interest rates.
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2022
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