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Herrera will maintain Mexico’s economic policy

Wednesday, July 10, 2019

Significance

Urzua’s abrupt departure is the most high-profile that AMLO has experienced in his seven months in office.

Impacts

  • The peso will be volatile for some time but a tight monetary policy should avert any long-term depreciation due to Urzua’s resignation.
  • His resignation deprives the government of an individual trusted by the markets to contain the government’s most statist members.
  • Herrera is known to favour lower interest rates, but there is no expectation that he will put undue pressure on the Bank of Mexico.
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