Banxico Leaves Rate Intact

As expected, Banxico has left the monetary policy rate at 4.50%. The bank says in a statement that industrial production and exports have been growing at a high rate, but that this could be affected by the slowdown in the US economy, where unemployment remains high and consumption is still below pre-crisis levels. In a report, Barclays says it believes that in the most likely scenario, Banxico will maintain the current 4.50% rate for several months. Morgan Stanley says in a report that it expects the rate to remain at 4.50% for the rest of the year, increasing to 5.50% by the end of 2011.