Thursday, May 25 2017 | ASIA TODAY INTERNATIONAL - Reporting the Business that Matters in Asia
Updated: 9 hours 44 min ago
Annual headline inflation surprised on the upside to 9.2% from 8.5% in December. The main drivers behind the surge were food inflation (harsh weather conditions) and higher energy prices, while FX pass-through has showed only minor signs of impact on the core so far.
We believe the exchange rate regime of the RMB will ultimately shift to a floating one as other major economies in the world. The floating of the RMB could come in the second half of 2018. Although certain degree of currency overshooting is inevitable, the final floating will help China’s economy restore its external balance and push up the exchange rate in the long run.
In December 2016 remittances to Mexico amounted to US2,336.4 million, 6.2% more than in December 2015. Total remittances for 2016 reached an all-time high of US$26.97 billion, 8.8% more than in 2015 and surpassing the previous (2007) record of US$26.06 billion
The Central Bank increased the average funding rate over 10% in the face of exchange rate and inflation pressures. Our GDP indicator signals a gradual recovery, rendering our 2.3% 2016 growth forecast feasible.
In December, activity increased in 44 states, with strongest gains in the West. Activity decelerated in the Sunbelt, despite pickups in the manufacturing, mining, and retail trade sectors. Despite a strong dollar and weak exports, manufacturing activity to benefit from improved domestic demand.