07:25 AM EDT, 09/25/2024 (MT Newswires) -- Because of the lags of monetary policy BBVA Research thinks that Mexico's central bank is already late in adjusting the excessively high real interest rate and as such the monetary policy stance is set to continue to weigh on the economy in the coming quarters.

Banxico is slated to release its policy statement on Thursday.

A second consecutive rate cut seems a done deal, as recent developments suggest that both Governor Victoria Rodriguez and Deputy Governor Galia Borja will join Deputy Governor Omar Mejia again in supporting a rate cut this week, stated BBVA Research.

A "forceful" 50bps reduction rather than a gradual and more likely 25bps cut would be a very welcome surprise and a sound policy decision, according to BBVA Research.