Yesterday, and thanks to the mediation of the Pakistani government, the US and Iran reached a two-week ceasefire agreement, during which the Strait of Hormuz will be fully open to ship traffic and the parties will continue negotiating toward a stable peace. The announcement came at the last moment — just two hours before Trump's ultimatum to intensify attacks against Iran was set to expire. In addition, the US president said he had received a 10-point proposal from Iran that he considers a viable basis for negotiation.

Our take

The worst-case scenario has been avoided and financial markets are celebrating. The truce was the most anticipated news for investors, after six weeks of intense turbulence and volatility. The announcement represents the first indication that hostilities may come to an end, or at least that both parties are showing willingness toward that outcome. The future trajectory of financial asset prices will depend on whether the talks translate into a lasting agreement and a sustained normalization of flows through the Strait.

In the most recent Banamex Expectations Survey, analysts reduced their GDP growth projection for 2026 from 1.5% to 1.4%. On inflation, they revised their year-end estimate upward to 4.23% from the previous 4.10%, while the core component projection remained at 4.20%. Regarding monetary policy, the consensus anticipates that Banxico will pause rate cuts at its May meeting and resume them in June, with the funding rate closing 2026 at 6.50%.

Our take

The new GDP estimates for 2026 incorporate the unexpected loss of momentum observed in the first readings of some economic indicators. Meanwhile, the inflation figure reflects the sharper increases in the non-core component. Regarding monetary policy, it is surprising that the consensus anticipates Banxico's next rate move would not come until June, especially given that at its last meeting the authority signaled interest in lowering the rate again soon.

Today the Federal Reserve minutes corresponding to its March 18 meeting will be published, at which the Committee decided to keep the federal funds rate unchanged in the range of 3.50% to 3.75%. The Fed minutes could emphasize a prudent "wait and see" approach, conditioned not only on the trajectory of inflation and employment, but also on the evolution of the international environment. Additionally, it is worth recalling that the vote was divided, with the sole dissenting vote from Stephen Miran, who favored a 25 basis point cut.

Our take

The Fed's forward guidance would tend to reflect greater sensitivity to external shocks, with a slightly more restrictive bias in the event of renewed inflationary pressures. In this context, the Federal Reserve could reinforce flexible communication, indicating that while gradual cuts remain contemplated going forward, they are not predetermined and could be postponed if inflationary risks linked to geopolitical factors or tariffs materialize.

The central bank of India has decided to keep its monetary policy unchanged, in line with market expectations. Specifically, the institution left its interest rate at 5.25%, confirming a pause in its cycle following the moves made in recent months. Meanwhile, the Reserve Bank of New Zealand also chose to leave its rate unchanged at 2.25%.

Our take

The market had largely priced in these moves, in a context of high global uncertainty and following the latest cautionary signals from both monetary authorities.

Markets and Stocks

The rally in fixed income was as significant as in equities. 10-year Treasury yields fell five basis points toward 4.24%; UK gilts plunged 22 basis points, their largest decline in months; German bonds shed 16 basis points. Bets on interest rate hikes by central banks moderated significantly, particularly for the Fed and the European Central Bank. Even for the US monetary authority, the probability of rate cuts this year could eventually increase.

In international markets, the MSCI Emerging Markets index rose as much as 5.3%, its best session since 2022, with emerging market currencies erasing their year-to-date losses. The biggest beneficiaries were oil-importing countries such as South Korea, Taiwan, and India. The reduction in oil prices simultaneously alleviates pressure on the current account, inflation, and fiscal positions of emerging market energy importers.

Corporate News

The country's three main airport groups published their March 2026 traffic figures. OMA reported the group's best relative performance, with 2.8% growth in total traffic across its 13 airports, driven by domestic traffic which advanced 3.9%, while international traffic retreated 2.8%. ASUR recorded a modest 0.6% increase in total traffic of 6.6 million passengers, with Colombia serving as the group's growth engine at 12.5%, partially offsetting declines in Mexico (-2.4%) and Puerto Rico (-2.3%). GAP was the most affected group, with a 7.6% decline across its 12 Mexican airports. In Jamaica, Kingston advanced 1.0% while Montego Bay fell 25.7% due to the effects of Hurricane Melissa.

Our Take 

The figures should be read with caution: Easter 2026 was moved earlier to the period of March 29 to April 5, compared to April 13–20 in 2025, which distorts year-on-year comparisons by incorporating vacation traffic in March of this year that was recorded in April last year.

SpaceX released details of its IPO, with a target valuation of around US$1.75–2 trillion that would immediately make it the sixth most valuable listed company in the US. Additionally, Intel announced it will join the Terafab AI chip project alongside SpaceX and Tesla to manufacture processors for robotics applications and data centers.

Delta Air Lines reported first quarter 2026 results in line with its initial guidance, with adjusted operating revenues of US$14.2 billion, driven by broad strength in corporate, premium, and loyalty segments. Earnings per share were US$0.64, more than 40% above the same quarter of 2025. For the second quarter, Delta guides for low double-digit percentage revenue growth on flat capacity, an operating margin of between 6% and 8%, and earnings per share of between US$1.00 and US$1.50.

Our take

The announcement of the ceasefire between the US and Iran and the resulting drop in jet fuel prices would arrive as significant relief for second-half margins, potentially improving the guidance Delta just published if crude prices stabilize at current levels.

The to-do list

Quote of the day

"Markets go down by the stairs and up by the elevator. Today, it was the elevator."

— Anonymous, Wall Street