Mexico

Mexico's headline inflation eased in the first half of September, official data showed on Friday, with the president calling on the central bank to focus on promoting economic growth given the improving inflation data, Reuters reported. Headline inflation in Latin America's second-largest economy hit 4.44% in the 12 months through early September, down from 4.64% at the end of August, data from statistics agency INEGI showed.

Mexico's economy grew in August by 3.4% compared with the same month a year earlier, and by 0.2% from the previous month, according to a preliminary estimate published by national statistics agency INEGI on Tuesday, Reuters reported. A breakdown of INEGI's preliminary data showed that secondary activities, which include manufacturing, increased in August by 4.8% on the year, while tertiary activities, which encompass the service sector, were up by 2.8%. Read more.

Credito Real will file as soon as next week a prepackaged insolvency agreement in a Mexican federal court in a bid to resolve the collapse of what had been the country’s biggest payroll lender, Bloomberg News reported. Creditors provided the company with documentation this week showing that holders of more than 50% of Credito Real’s $1.9 billion of dollar bonds had agreed to the deal, which allows for the filing to move forward.

Mexico’s annual inflation eased roughly in line with expectations in August, as the central bank says it’s not yet ready to discuss lowering record high borrowing costs given the “complex and uncertain” global outlook, Bloomberg News reported. Consumer prices rose 4.64% from the same month a year earlier, down from 4.79% in July, the national statistics institute reported Thursday.

Nubank, one of Latin America's biggest fintech companies, announced on Tuesday the launch of personal loans for the Mexican market, aiming to boost its financial services portfolio in the region's second-largest economy, Reuters reported. The new product will allow customers to obtain personal loans in less than five minutes through its platform, the digital bank's Mexican arm, known as Nu Mexico, said in a statement. The service will be available to employees on a test mode before hitting the market in the following months, it added.

Mexico’s central bank raised its growth projection for the country’s economy for this year and next, signaling that activity is surpassing policymakers’ expectations in large part due to strong trade with the U.S., Bloomberg News reported. Banxico, as the central bank is known, revised its estimate for 2023’s expansion to 3% from the prior reading of 2.3%, according to its quarterly report released Wednesday. For 2024, the bank now expects a 2.1% GDP expansion compared to the previous 1.6% estimate.

TV Azteca SAB agreed to negotiate with U.S. bondholders owed $400 million after a U.S. judge warned the second biggest broadcaster in Mexico that it could be forced to participate in a bankruptcy case in New York, Bloomberg News reported. U.S. Bankruptcy Judge Lisa G. Beckerman told the company that it was obvious to her that TV Azteca had to restructure its debt, despite strong resistance from the company. TV Azteca opposes a U.S. bankruptcy and has used court rulings in Mexico to try to block bondholders from collecting on the defaulted bonds.

Mexico’s annual inflation eased roughly in line with expectations in early August, a positive sign for the central bank as it continues holding its interest rate at a record high to slow price growth, Bloomberg News reported. Consumer prices rose 4.67% in the first half of the month compared to the same period a year earlier, down from 4.78% in late July, the national statistics institute reported Thursday.

When global inflation surged in 2021, many of Latin America’s central bankers were the first to raise interest rates, moving months before the Federal Reserve began tightening. Recalling how hyperinflation topped 3,000% in some countries in the 1980s, central-bank economists from Brasília to Lima to Mexico City knew all too well the damage that soaring prices could cause. Now, Latin America is again at the forefront of the cycle, cutting rates as inflation comes back down, the Wall Street Journal reported.

The Mexican government is likely to continue supporting heavily indebted state oil firm Pemex with about $15 billion per year, Fitch ratings agency said in an a report on Wednesday, adding these will at least cover international bond debt amortizations, Reuters reported. However, should the government substantively increase its support for Pemex, this would have a negative credit effect on the sovereign, Fitch added.