BRL and MXN to remain at strong levels against the Dollar – Commerzbank USDMXN USDBRL Banks
. Economists at Commerzbank expect both currencies to remain strong against the US Dollar.“Both central banks have been so hawkish of late that I think the Fed's rate pause was a necessary condition for the BCB and Banxico to consider moving away from their ultra-hawkish stance. Given the high real interest rates in Brazil and Mexico, slightly lower policy rates seem justified.”
“However, with inflation still elevated, both central banks are likely to be careful to keep monetary policy sufficiently tight to avoid the risk of additional inflationary pressures from a weaker currency. Accordingly, we see the BRL and MXN remaining at strong levels against the Dollar.”Information on these pages contains forward-looking statements that involve risks and uncertainties.
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