The Day at a Glance | January 16 2023

*January`s preliminary consumer confidence figures made public by the University of Michigan logged considerable improvement and exceeded market expectations.

*The Federal Government will allocate 6,276 million pesos to aid those affected by Hurricane Agatha in Oaxaca, which damaged water drainage infrastructure, roads and public areas in 31 of the state`s municipalities. 

*Russia`s attack on the Ukrainian city of Dnipro left 40 dead.

*The World Economic Forum (WEF) in Davos will begin today. According to Reuters, two thirds of Chief Economists surveyed by the WEF expect a global recession in 2023.

*US markets will remain closed today due to Martin Luther King Jr. Day

Economic environment

The University of Michigan`s Consumer Sentiment Index logged a 9-month high figure (64.6 points). January`s figure is mainly explained by a decrease in 12-month inflationary expectations to 4.0%, the lowest level since May of 2021. However, the one-year drop in inflationary expectations contrasted with the rebound in 5-10 year inflationary expectations, which set at a 3% level (2.7% prev.). Additionally, the component that measures sentiment concerning current conditions reached 68.6 points  (59.6 in Dec.). Overall, January`s preliminary results seem to point towards inflationary expectations that remain anchored and that consumer sentiment is still strong even despite warnings of an economic slowdown this year.

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