The Day at a Glance | January 13 2023

*Japanese credit rating company, R&I, confirmed Mexico`s BBB+ rating and increased the country`s sovereign debt outlook.

*China`s external sector receded in December in light of weak global demand. Exports and imports decreased -9.9% and -7.5% annual, which led to a 78 billion dollar trade surplus. 

*Industrial production in the Eurozone rebounded in November by logging a 1% monthly increase, exceeding the expected 0.5%. At an annual rate, industrial production increased 2.0%.

*Tom Barkin (Richmond FED) and Patrick Harker (Philadelphia FED) pointed towards a slower interest rate increase after December`s inflationary figures.

*This morning, the University of Michigan`s Consumer Confidence Index will be made known for January, which is expected to log its second consecutive increase (60.7 estimated by the consensus).  

Economic environment

Mexico`s long-term sovereign debt in foreign currency outlook was increased from Negative to Stable by R&I. In a press release made public on Thursday, the Japanese credit rating agency announced that the change in Mexico`s outlook is due to a strong fiscal stance and the absence of concerning elements in the external sector, or Mexico`s financial system. However, the agency considered it important to pay close attention to a “…series of government decisions to introduce policies that could discourage private companies` entry”. In the press release, the agency also acknowledged that private consumption during 2022 was strong – and that there was a positive effect that nearshoring had on private investment. With this, the credit rating agency confirmed Mexico`s BBB+ debt rating (three steps above investment grade) with a Stable perspective; and it doesn’t expect to modify its rating in the next 12 to 18 months.