In her office, located in the Historic Center of Mexico City, the deputy governor assured that Banxico has done its job and that the inflation that Mexico faces not only has its origins in the effects of the pandemic but in global inflationary pressures. “It has been documented that fiscal stimuli in other countries generate rebound inflation in other economies.”
Trump’s second arrival at the White House has not only put the consequences of the tariffs in the public eye, the Republican has also spoken out against Fed Chairman Jerome Powell, whom he was said to be seeking to remove from office. for not wanting to listen to their requests to reduce the interest rate.
For Espinosa, the criticism that a federal government can make towards a central bank can be natural but without interfering in decisions. “There are always logical tensions between the Executive and an autonomous central bank,” but he adds that it is the markets that act as a thermometer to give warning signals in the event of a violation of the autonomy of any central bank.
When asked if he was ever afraid of an attack against Banxico’s autonomy, Espinosa assured that the design of the bank’s legal framework was so solid that he did not see any attempted violation. “The design in the constitution of the autonomy of the Bank of Mexico is very robust, it is very solid and so is the governance. So, I didn’t see any sign that indicated something there and I think that in addition in these years we have had two presidents, President López Obrador and President Sheinbaum, who have publicly recognized that autonomy is a value and that it is respected,” he pointed out.
The economist highlighted that the autonomy of central banks, especially in emerging economies, has yielded very important results, especially since the 1990s.
More is less in communication
Something that has characterized Banco de México internationally has been the improvement of communication and transparency of the central bank’s views on the economy. One of the most recent cases was the publication of inflation expectations in each policy announcement. monetary instead of each quarterly report.
“I was recently talking to Mr. Miguel Mancera about this communication issue and he told me that it is incredible that at the time he was there, first as director and then as governor, where the best communication practice of Central Banking was not to communicate nothing. So, I think we’ve made a lot of progress and I think we’re going in the right direction. However, I also think that sometimes more is less. That is, giving more information will not always better guide the expectations of market participants,” he noted.
The economist highlighted that this communication has been one of the reasons why analysts do not believe in the Bank of Mexico’s forecasts, as mentioned by Deputy Governor Jonathan Heath a few months ago.
“I share the deputy governor’s vision in the sense that we have effectively seen that the market’s inflation expectations, not only from analysts, but also from market instruments, have been consistently above our own forecasts,” he added.
Two key moments in his management
Irene Espinosa arrived at the central bank in 2018 and became the first woman on the Governing Board and in the eight years she was at the bank she mentions two favorite moments: the design of the G family banknotes and some commemorative coins, as well as the inauguration of the Banco de México Museum.
The deputy governor highlights the furor that existed in Mexican society for the pieces that included historical moments and Mexican ecosystems, but the most famous case was that of the axolotl. “Something that is endemic, that is in extinction, was revalued and a very realistic but very nice image was achieved,” he highlighted.
“Another project that I loved participating in is the Banco de México Museum. The idea of opening the doors of the bank, the idea of bringing the work of an institution that does things, let’s say, from a point of view intellectually not accessible to a large public, but opening the doors and explaining what money is, opening the doors of this wonderful, historic, architecturally exceptional building, it was an incredible project,” he recalls.
No interest in being ratified
Although President Claudia Sheinbaum has not put on the table who will replace her as deputy governor of Banxico, Espinosa is clear about one thing: she is not interested in being ratified.
“The period that I am concluding is a long period and I am obviously very grateful for it, but it is important to allow new profiles. I believe a lot in cycles and staying too long in the same activity, in the same trench, because it does generate a certain blindness in us,” he highlighted.
He considered that leadership positions are to strategically contribute and help the advancement of the central bank. “It is super documented from institutions and good practices that say that you should not be in the same position for more than five years or they move you laterally or there is a promotion because it does not help the development of the institution.”
So in 2025, Irene Espinosa, a respected global economist who has been working uninterruptedly for more than 30 years, will seek to reinvent herself within the framework of her economist profile. He hopes to contribute to a national or international project after a period of rest.
“Take a week without a phone and read, read like that without stopping; take a distant trip, without any time pressure. I also like gardening, getting to know places I haven’t been to and mainly giving myself time for my physical health,” he concluded.
