The appointment of Victoria Rodríguez Ceja as Governor of Banco de México changed the perception and credibility that local and foreign investors had about monetary policy. This is shown by the survey carried out by Finamex, Casa de Bolsa.
The Latin American economist for the international consultancy Pantheon Macroeconomics, Andrés Abadía, had explained since June that the replacement of the Governor in Banxico would be very important and that the market would not hesitate to react if credibility and autonomy were put at risk. of the central bank.
Then, in December, when the change of the nominee was known, the same strategist explained to El Economista that “Mrs. Rodríguez Ceja will have to quickly demonstrate that she has the necessary capacity to understand these challenges and solve while the capital outflow continues.”
According to the results of the Finamex survey in December, obtained by El Economista, 62% of the investors consulted consider that it will affect the credibility of the Bank of Mexico, against 38% who assume that it will have no impact.
This question was asked by Finamex in the previous poll, when Arturo Herrera, the presidential nominee, was supposed to be in office in June. At that time, only 37% of those interviewed considered that the credibility of the central bank would be compromised with its arrival at the Governing Board, against 63% who estimated that it would not change.
The reading of Finamex, Casa de Bolsa about this change in the perception of investors is a warning that “the market will keep watching very closely.”
Questions about independence
From Switzerland, the investment bank Julius Baer explained in its last analysis of 2021 for Mexico, that “the unexpected appointment of Rodríguez Ceja as new governor raises questions about the independence of the decisions that the official will make.”
They emphasize that the predictability of monetary policy also becomes uncertain and warn that for the bank, Mexico is the long-term favorite, but they clarified that “the recommendation could be revised after the first monetary meeting of the year.”
The first currency board of 2022 is scheduled for February 10.
Benefit of the doubt
José Luis Ortega, director of the Debt and Multi-asset teams at BlackRock México, trusts that the change will not have a negative impact on the perception of Banco de México and its monetary policy.
“We do not foresee that the change of Governor will impact on monetary decisions. Rodriguez Ceja is a very prepared economist and aware of the responsibility she assumes upon entering the Governing Board and will surely do her job in the responsible manner that has always distinguished her ”.
We cannot forget that one member of the Board leaves, but four remain, so that there may be slight modifications, but nothing that significantly changes the responsibility of Banco de México in complying with the objective of the law, which is to ensure stability. of prices.
Uncertain trend
In the aforementioned survey, the experts consulted by Finamex admit that the trend of the rate is uncertain. But 50% of those interviewed consider that the next year can end in a range between 6 and 6.50 percent. If the forecast is correct, it would imply an increase of half a percentage point to a full one with respect to the level where it is currently.
Of those surveyed, 32% consider that there is room to think that the nominal rate can end between 6.50% and 7 percent.
While 16% do consider it possible that this rate is above 7 percent.
Reference-www.eleconomista.com.mx