Our Main Services

  • Accounting & Taxes

  • We strive to comply with accounting principles and tax requirements for your company. The information is always on time and available online.

  • Import & Export

  • Our management team has a significant knowledge of Mexican Trade Compliance and Foreign trade requirements.
    .

  • Human Resources

  • We are a talent-focused organization that recruits passionate and thoughtful staff and then invests significantly in developing them for your organization.

  • Environmental Health & Safety

  • We enable organizations to outsource all or part of this important aspect of their business to our fully qualified health and safety representatives.

Some Mexico central bank officials want deeper rate cuts, minutes show

MEXICO CITY (Reuters) - Mexico's central bank is likely to cut interest rates further, with some members of its governing board backing deeper reductions in borrowing costs to shield the economy from the shock of the coronavirus pandemic, minutes from its latest policy meeting showed on Tuesday.

All five members of the Bank of Mexico's board voted unanimously to lower the overnight interbank interest rate by 50 basis points to 6% at an April 21 out-of-cycle meeting, and the central bank unveiled some $31 billion in support for the financial system to help the economy weather the coronavirus pandemic.

One board member argued the most prudent course was to substantially lower the policy rate, so the real interest rate is below its neutral level as soon as possible, including the possibility of moving towards a real rate close to zero or even in negative territory, according to the minutes.

"Despite the unanimous decision, the minutes reflect that views among board members are not homogeneous. While most members embrace prudence in the easing process amid risks of fiscal deterioration and credit rating downgrades, there are views in favor of getting faster into an expansionary stance of monetary policy," Morgan Stanley said in a research report.

Morgan Stanley expects another 50-basis-point cut at the upcoming May 14 policy meeting, while Goldman Sachs economist Alberto Ramos said in a separate report he expects the central bank to drive the policy rate down to 4.50% by the end of 2020.

Mexico's economy is facing an unprecedented shock in the coronavirus pandemic, and "idiosyncratic" factors, such as the recent credit ratings downgrades of the sovereign and state oil firm Pemex, are making matters worse, according to the minutes.

Most of the Bank of Mexico's board members "warned that the adverse environment the domestic economy is facing resulting from the pandemic and the lower oil prices is worsened by idiosyncratic factors," according to the minutes.

"In this context, most members highlighted the recent downgrade of the sovereign and Pemex's credit rating by three agencies," the minutes added.

All of the board members said Mexican economic activity is forecast to contract "significantly" during the first half of the year, and underscored that the magnitude and duration of the pandemic's effects are still unknown.

The economic shock from the pandemic is already clearly visible in the Mexican economy and forecast declines in global economic activity are of a magnitude not seen since the Great Depression, according to the minutes.

Most of the bank's board members said the impact is evident in consumer and business confidence, credit card spending, manufacturing orders, purchasing managers' indexes, car sales, air and land transportation and hotel occupancy and tourism flows.

The Client List

  • 1

About Mexcentrix

We assist companies with their manufacturing operations in Mexico.

Keep in Touch

 

  This email address is being protected from spambots. You need JavaScript enabled to view it.
  +1 (877) 212-5593
  Himalaya 210 San Luis Potosi

 

Get Map

Mexcentrix

Print

Latest News

10
Aug2020

SAT cobra un retroactivo de...

Colegio de Contadores considera que la medida es meramente recaudatoria e ilegal; benéfico que Prodecon fije su...

09
Jun2020

Stumbling angel? Mexico risks losing...

MEXICO CITY (Reuters) - Mexico is facing its deepest recession in decades and prominent investors believe it...

28
May2020

CFE chief vows to end...

The director of the Federal Electricity Commission (CFE) has vowed to put an end to “simulation and...

15
May2020

Mexico green lights auto industry...

MEXICO CITY (Reuters) - Mexico will begin opening some automotive factories from May 18 under a plan...

06
May2020

Some Mexico central bank officials...

MEXICO CITY (Reuters) - Mexico's central bank is likely to cut interest rates further, with some members...

04
May2020

Mexico's economy plunges deeper into...

MEXICO CITY (AP) — Mexico’s economic activity dropped 1.6% in the first quarter compared to the final...

22
Apr2020

'A failure foretold': Mexican president's...

MEXICO CITY (Reuters) - Mexican business leaders fed up with President Andres Manuel Lopez Obrador are beginning...

03
Apr2020

Mexican Economy May Contract by...

MEXICO CITY — Mexico's Treasury predicted Thursday that the country's economy will contract by as much as...

29
Mar2020

Mexico’s President Pushes Relations with...

Mexican President Andres Manuel Lopez Obrador’s relationship with the country’s business elite is rapidly deteriorating over the...

21
Mar2020

U.S., Mexico banning ‘nonessential’ crossings...

WASHINGTON – The U.S. and Mexico were moving to restrict “nonessential travel” across the border just after...

20
Mar2020

Ford, GM, Fiat Chrysler agree...

Ford Motor Co., General Motors Corp and Fiat Chrysler have all decided to halt production as the...

09
Mar2020

Mexican Private Sector Pitches $92...

MEXICO CITY — Mexico's private sector has drawn up a broad package of proposed energy investments for...

04
Mar2020

Mexico FX to stay on...

Mexico's peso is seen vulnerable to further slumps with the U.S. election campaign in focus after ending...

17
Feb2020

Spanish court keeps former Mexican...

MADRID, Spain (AP) — A Spanish court ruled Thursday that a former head of Mexico's state oil...

15
Jan2020

Mexican bank Banorte inks deal...

MEXICO CITY (Reuters) - Mexican bank Grupo Financiero Banorte said on Sunday it had signed an agreement...

09
Jan2020

Mexican auto exports post first...

MEXICO CITY (Reuters) - Mexican auto exports posted their first decline in a decade last year, while...

18
Dec2019

Mexico Raises Minimum Wage by...

MEXICO CITY — Mexico raised its national minimum wage 20% Monday, but it still doesn't amount to...

12
Dec2019

Mexican businesses focus on labor...

MEXICO CITY/WASHINGTON (Reuters) - Mexican business leaders on Wednesday began poring over texts of a new stricter...

27
Nov2019

Mexico to spend $44 billion...

MEXICO CITY (Reuters) - Mexico's government on Tuesday announced the first phase of an ambitious infrastructure plan...

19
Nov2019

Jorge Vergara, billionaire owner of...

Jorge Vergara, the billionaire owner of the Mexican soccer club Chivas, died Friday after suffering a heart...

«
»