Mexico
Mexico’s central bank eased, even as global central banks are turning cautious, supporting our EM strategists’ view that Mexico will outperform EM peers. Banxico cut by 25 bps Thursday, consistent with our Emerging Markets strategists’ view that investors…
Go long LATAM ex. Brazil banks / short global bank stocks. Brazilian bank equities will underperform due to poor and worsening macro fundamentals.
Despite similar headline inflation, underlying dynamics favor Mexico over Brazil across EM assets. Brazil’s latest CPI print was in line with consensus at 4.44%, near the upper end of the target range. In Mexico, inflation surprised modestly to the downside…
Although inflation has fallen within the upper end of the target range in both of LatAm’s largest economies, our EM strategists are more constructive on monetary easing and financial markets in Mexico than in Brazil. Mexico’s latest CPI prints surprised to…
Our Emerging Markets strategists recommend staying overweight Mexico across equities, fixed income, and FX, and introduce a new trade: long Mexican stocks / short the S&P 500. Mexican assets remain well positioned to outperform their EM peers, supported…
Mexican equity and fixed-income markets will continue outperforming their EM counterparts, regardless of whether global risk assets sell off or not. Also, we recommend a new trade: long Mexican stocks / short the S&P 500.
Continued monetary easing supports our view of buying Mexican local currency bonds. The central bank (Banxico) cut rates by 25 basis points to 7.25% for another meeting in a row. Banxico will persist in its rate-cutting cycle as disinflation takes…
September CPI releases in Brazil and Mexico reinforce a divergent inflation and policy outlook that supports an overweight stance in Mexican local bonds and currency relative to Brazilian assets. Brazil’s headline CPI at 5.2% was slightly higher than in…
Banxico cut rates to 7.5%, reinforcing our call to go long Mexican local bonds and overweight Mexico across EM portfolios. Inflation is within target, giving policymakers space to ease. Sound fiscal management and strong external accounts continue to support…
Banxico’s latest rate cut reinforces our bullish view on Mexican domestic bonds. Mexico’s central bank eased policy by another 25 basis points to 7.75%. Investors should bet on further easing. Inflation will continue falling within the target range…