Latin America Weekly: Lower oil prices, Banxico on track for another 50bp cut

The downward revision to our oil price forecast is likely to exacerbate public finance risks in some of the region's major oil producers, notably Colombia and Ecuador. But other countries, especially Chile, will benefit as lower energy prices support the disinflation process. Elsewhere, comments this week from Banxico's Deputy Governor Jonathan Heath once again highlighted policymakers' concerns about the weakness of Mexico’s economy. This is a key reason why we expect Banxico to look through the rise in inflation in April and press ahead with another 50bp cut, to 8.50%, at its meeting next Thursday.