Overview

• Futures pricing points to a 25-basis-point Federal Reserve cut on September 17 with investors expecting additional reductions later this year.
• Jerome Powell’s Jackson Hole remarks opened the door to easing, as August payrolls rose by only 22,000 and U.S. inflation picked up to 2.9% on headline measures with an FT core gauge near 3%.
• Fed voices have shifted toward growth risks, with St. Louis’s Alberto Musalem citing rising labor-market downside and New York’s John Williams signaling room to move toward neutral, while Austan Goolsbee urged caution.
• Banxico has lowered its policy rate from 11.25% to 7.75% across 12 moves since March 2024 and indicated it will evaluate further reductions.
• Moody’s Analytics warned Mexico’s policy stance is nearing neutral despite core inflation rising to about 4.2%, as Finance Secretary Edgar Amador underscores expectations for lower rates to bolster growth.