Banco de México is, in these times, an extremely discreet institution. Sometimes it seems that he falls into a silence that leaves gaps in communication that are filled with the ill-informed and intentional stridency of Palacio’s usual morning message.
Until a few fortnights ago, when inflation was rising and there was full justification for a tightening of monetary policy, it was enough with the plain message of increasing the interest rate.
Even at that moment of obviousness regarding the actions of the Banco de México’s Governing Board, there was an unofficial debate between some of the members of the bank’s collegiate body.
Beyond the minutes where the anonymity makes us read that “some” say, “others” answer and “another” considers, without further reference to their identities, the reality is that, in those moments of greatest tension, even to the Last year, both Jonathan Heath and Gerardo Esquivel, deputy governors of Banxico at the time, were in charge of standing up to the internal debate.
Through social networks, the two economists and colleagues on the Governing Board presented their arguments to be more aggressive with monetary policy, according to Heath, or more condescending with the performance of the economy, according to Esquivel.
In the past, the hawks were right and the vertiginous rise in the reference rate had an influence in putting a ceiling on the inflationary increase. Gerardo Esquivel, despite the consistency of his thought with his arguments, did not achieve presidential ratification as deputy governor.
Today the obviousness of the movements to be followed by Banxico is over. Many components already play a role in monetary policy decision-making and they have to explain them clearly so that their message is taken correctly by the markets.
Headline inflation is low, but core inflation remains under some pressure; The strength of the peso against the dollar is seriously anchored to the level of premium provided by the interest rate, even though each economic specialist argues a different explanation for the super peso.
Such a high interest rate is necessarily uncomfortable for a stagnant economy like the Mexican one with the burdens generated by public policies and which is heading towards a possible recession in the United States.
At this time there are no messages on social networks from the most active deputy governors. That only guide that the markets had disappeared in what appears to be an internal agreement to control and centralize communication.
But those messages don’t come through clearly. The governor of Banxico, Victoria Rodríguez, does not have an active communication style, so everything is focused on the clarity of the statement that accompanies the monetary policy decision.
Tomorrow we will know what they decided regarding the level of the interbank rate, currently at 11.25%, and we will read what the Governing Board foresees going forward.
So, in those few written words that will accompany the decision, they have to put a clear and sufficient message so that it reaches and is believed in the markets.
Banco de México is at the point where it has to speak and take care of each and every one of its words.
The governor of Banxico is not of an active communication style, so everything is focused on the clarity of the statement that accompanies the decision.
