US stock indices did not trade yesterday due to the bank holiday.

The Mexican peso held steady at 20.3 per US dollar, showing resilience despite Banxico’s dovish stance, supported by a still high interest rate differential and the temporary postponement of US tariffs on Mexican goods. While the Bank of Mexico’s recent 50bp rate cut to 9.50% and its recommendations for further easing may narrow the policy gap with the Federal Reserve and put pressure on the peso, continued investor demand for high-yielding assets provided support.

Equity markets in Europe were mostly up on Monday. Germany’s DAX (DE40) rose by 1.26%, France’s CAC 40 (FR40) closed 0.13% higher, Spain’s IBEX 35 (ES35) gained 0.47%, and the UK’s FTSE 100 (UK100) closed positive 0.41%. European indices rose thanks to gains in defense sector stocks amid expectations of increased military spending by European governments. European leaders met in Paris to discuss Russia’s invasion of Ukraine after the US signaled limited support and US-Russian talks on the conflict are due to begin this week in Saudi Arabia, although uncertainty remains over Ukraine’s involvement and Europe’s exclusion. Meanwhile, President Trump confirmed plans to impose tariffs on foreign cars from April 2, adding to trade tensions between Europe and the US.

Brent crude oil remained just below $75 a barrel on Monday as investors watched progress on a possible peace deal between Russia and Ukraine that could ease sanctions and boost oil supply. US President Donald Trump has said he may soon meet with Russian President Vladimir Putin to discuss ending the war, with the first talks between the US and Russia due to take place this week in Saudi Arabia. If the talks are successful, more Russian oil could flow to global markets, increasing supply. In addition, Iraq’s Kurdistan region said oil exports could resume next month.

Asian markets were mostly down on Monday. Japan’s Nikkei 225 (JP225) was up 0.06%, China’s FTSE China A50 (CHA50) was down 0.14%, Hong Kong’s Hang Seng (HK50) was 0.02% cheaper, and Australia’s ASX 200 (AU200) was negative 0.22%. On Chinese indices yesterday, traders were taking profits after a rally in the technology sector as they awaited further policy signals from Chinese President Xi Jinping’s meeting with private enterprises including Alibaba, Meituan, Xiaomi Corp, and BYD Co.

The Australian dollar fell below $0.635 on Tuesday, reversing previous gains after the Reserve Bank of Australia (RBA) cut its cash rate by 25 basis points to 4.1%, in line with expectations. This is the first rate cut since November 2020, driven by easing inflationary pressures. The decision recognizes positive progress on inflation, but the council remains cautious about the prospects for further policy easing. The statement also signals the Central Bank’s intention to gradually remove any further monetary restrictions.

The New Zealand dollar slid to $0.571 on Tuesday, breaking a three-day winning streak and retreating from a two-month-high, as investors await the Reserve Bank of New Zealand’s policy meeting. The RBNZ is expected to cut the official money rate by 50 bps on Wednesday, bringing it to 3.75% amid rising unemployment, lower economic growth, and inflation concerns. Traders will also pay attention to RBNZ Governor Adrian Orr’s press conference after the rate decision, which could provide insight into the interest rate outlook. It is expected that the Central Bank may cut the benchmark rate by 25 bps at each of its next two meetings in April and May.