The fall in Mexican inflation, to 3.4% y/y, in the middle of this month, supports our view that Banxico will cut its policy rate by a further 25bp, which we now expect to happen at next month’s meeting. Elsewhere, the further rise in Brazilian inflation over the same period, to 4.2% y/y, was driven by surging food prices. We think that the central bank will look through this.
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