Economists resume the upward trend of inflation by the end of 2018

Citibanamex analysts have taken over the Upward trend in its forecast of total inflation at the end of 2018 and now they expect it to end at 4.55% by the end of the year.

The survey on Citibanamex's expectations indicates that analysts are expecting the year to end with a general inflation for 2018 of 4.55%, compared to 4.50% during the year. from the previous survey.

Analysts have adjusted their inflation estimates upward since at least the second half of August of the current year, when they predicted that inflation would close at 4, 30%.

In terms of core inflation, the Citibanamex survey showed analysts expect it to be 3.59% from the previous 3.55%.

Core inflation has remained virtually unchanged since the second half of August (3.60%).

For 2019, analysts maintain their basic inflation and core inflation expectations unchanged at 3.70% and 3.50%, respectively.

He added that the consensus predicts that overall inflation would be around 5.0% during the first half of October.

"A change of 0.46% every two weeks is expected for the INPC the first two weeks of October, implying an annual rate of 5.00%, lower than the rate of 5.17% observed over the previous two weeks, on 0.16% every two weeks, which implies an annual rate of 4.04%, higher than the rate recorded over the last fifteen days of 3.78% ", -he declares.

The consensus predicts that for the whole of October, annual general inflation will be close to 5.0%.

Polarized outlook on monetary policy.

Although the median of the consensus retained until April 2019 is the date of the next policy change and to maintain at 7.75% and 7.25%, respectively, the closing levels of the funding rate for 2018 and 2019 , the results obtained: from the most recent survey show divided opinions.

"35% of participants believe that Banxico will raise the rate before the end of the year, with one of them considering an increase of 50 basis points in December. In contrast, 40% said that a rate cut would be held between spring and summer 2019. 25% chose not to respond, "he said.

Regarding the exchange rate, the Citibanamex survey revealed mixed movements in the peso estimates against the dollar.

"The median of the survey now indicates a level of 18.94 for the dollar-peso parity for the end of this year compared to 19.10 previously.However, for the closing of 2019, it is raised to 18 , 85 compared to 18.78 ", he said.