Latin America Economics

Latin America Focus
04 February, 2010

Is Mexican inflation about to take off?

A combination of one-off factors means that Mexican inflation is likely to accelerate in the first quarter of this year. But the large amount of spare capacity that has opened up over the past eighteen months means that a sustained pick-up in inflation is unlikely. Accordingly, with fiscal policy set to tighten, we expect interest rates to remain at their current record low until at least the end of this year....

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