Next Mexican central bank board member to be nominated Friday

Banxico has a mandate to ensure the "purchasing power stability" of Mexico's peso currency, according to its constitutional marching orders. The new deputy governor will replace Javier Guzman, known as one of Banxico's more hawkish board members, applying a more cautious approach to cutting the bank's main lending rate.

A second female Mexican deputy central bank governor will be announced on Friday, President Andres Manuel Lopez Obrador said, in an effort to diversify the Bank of Mexico's governing body.

Lopez Obrador, who spoke at his regular morning news conference on Thursday, has often defended the Bank of Mexico's autonomy. But he has also nudged the bank to lower interest rates to spur lending. The left-leaning Lopez Obrador has already appointed two other deputy governors to the five-member board of Banxico, as the bank is known. Irene Espinosa is the only female board member.

The bank's governor and deputy governors all serve staggered terms, which is meant to bolster the institution's independence. Banxico has a mandate to ensure the "purchasing power stability" of Mexico's peso currency, according to its constitutional marching orders.

The new deputy governor will replace Javier Guzman, known as one of Banxico's more hawkish board members, applying a more cautious approach to cutting the bank's main lending rate. Few clear indications have surfaced about who Lopez Obrador could nominate, though several serving officials, including Victoria Rodriguez, a deputy finance minister, are mentioned by officials and analysts as potential candidates.

Some believe the president could spring a surprise. Last month, Banxico's hawks appeared dominant as they defied expectations, holding borrowing costs steady for the first time in nearly 1-1/2 years.

Lopez Obrador's pick will need to be approved by the Senate. In a sharp break from his predecessor, Lopez Obrador has picked women for many senior roles, including in his cabinet, where gender parity has mostly been the norm over his first two years in office.

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