Mexico: Banxico cut by 50bps – TDS

Banxico cut rates ahead of the regularly scheduled March meeting by 50bps, and introduced a number of measures to improve bank liquidity, economists at TD Securities apprise. USD/MXN trades at 24.7711.

Key quotes

“Banxico took the step to move forward its monetary policy decision (unannounced) from next week and decided by majority to cut the overnight rate by 50bps. The decision was by majority, with one member voting to cut by a smaller 25bps amount.”

“MXN volatility is very much a key factor in future policy decisions, and thus overall FX market conditions will weigh heavily in how policy makers move forward with further easing.”