The Day at a Glance | December 2 2021

The Top

*Minimum wage in Mexico will increase 22% starting in 2022.

*Republicans and Democrats fail in first attempt to negotiate the temporary funding law that avoids a government shutdown this Friday.

*Inflation in Europe surprised to the upside during October due to energy prices: 5.4% monthly (vs 3.5%e.), 21.9% annual (19%e.).

*The U.S. manufacturing sector accelerated and maintained a firm rate of growth in November (61.1), according to ISM indicators.

*Powell reaffirms Congress that the FED will adapt its monetary policy to risks of a more persistent rate of inflation.

*First Omicron case was confirmed in the United States.

*Evidence suggests that Omicron doesn’t cause more deaths than previous variants; Pfizer expects its vaccine to maintain efficacy.

Economic environment

Minimum wage will increase in Mexico. The Representative Council of the National Minimum Wage Commission unanimously decided to increase the minimum wage 22% in Mexico on January 1st, 2022. The increase consists of 9% due to wage-fixation and an increase in the Independent Recovery Amount (from 25.45 pesos for the Northern Border Free Zone and 16.9 in the rest of the country). With this, the minimum wage will increase from 141.70 pesos per day to 172.87 pesos per day. The Council that made this decision is made up of worker, employer, and government representatives, who have used the Independent Recovery Amount (IRA) mechanism to ensure that the increase in minimum wage is gradual and doesn´t cause any pressures on prices in the economy; additionally, the amount considered in the IRA is not used to fix other current wages. This is the largest nominal increase in minimum wage since 1987, according to the National Minimum Wage Commission. The Business Coordinating Council considered the agreement as confirmation of the solidarity and commitment that businesses have to improve worker salaries, which are essential in order to reach development and social welfare goals.