Banxico likely to keep rates on hold - TDS

Analysts at TD Securities are expecting the Banxico to keep rates on hold at the February meeting, and expect little in the way of substantial change in policy tone that would do anything to nullify their view that the policy rate is kept constant for the duration of the year.

Key Quotes

“We see little positioning risk going into the meeting for FX, though the large move in the TIIE curve over the past two months strongly suggests a bias in expectations for an increasingly dovish Banxico in the coming months.”

“Given our view on the current inflation risk environment we don't think it benefits Banxico to show any dovish inclination at this point and so there is some chance for a minor bear steepening.”