BCB independence, Banxico could resist calls for hike

A bill to make Brazil’s central bank formally independent, which has been rumoured this week, would boost market optimism about Jair Bolsonaro’s reform promise and have positive long-term economic effects. Elsewhere, markets are pricing in an interest rate hike at Mexico’s central bank’s policy meeting next week, but we think that the board could opt to keep its powder dry until Andrés Manuel López Obrador’s policy platform becomes clearer.