The Day at a Glance | March 12 2025

The Top

• In the US, February’s CPI inflation came in below market consensus expectations.
• Starting today, the US is imposing a 25% tariff on steel and aluminum imports, primarily affecting Mexico and Canada. The measure aims to reduce the trade deficit but has created market uncertainty.
• The European Union will impose tariffs on US products in retaliation for Trump’s protectionist measures in the steel and aluminum sectors. This action, backed by several member countries, impacts key US exports and could escalate the trade war.
• The Bank of Canada cut its key interest rate by 25 basis points to 2.75% in its March 2025 decision, in line with market expectations. This adjustment brings the total rate cuts to 225 basis points since the easing cycle began in June 2024.
• Bank of Japan Governor Kazuo Ueda downplayed the recent rise in bond yields on Wednesday, stating that it´s a natural market reaction to expectations of future rate hikes by the central bank.
• The Ukrainian government has agreed to a ceasefire with Russia, while Washington considers halting military aid shipments. The measure aims to ease tensions but has sparked debate in the US and Europe.
• Oil prices edged higher on Wednesday, supported by a weaker dollar. However, gains were limited by growing concerns over a US economic slowdown and the impact of tariffs on global growth.

Economic Environment

In the US, February’s CPI inflation came in below market consensus expectations. The Bureau of Labor Statistics released its consumer price index (CPI) figures for February, showing a 0.2% m/m increase, according to seasonally adjusted data. The housing component rose 0.3% m/m, but this was largely offset by a 4.0% m/m decline in airfares and a 1.0% m/m drop in gasoline prices. On an annual basis, CPI inflation stood at 2.8% in February, below the market consensus expectation of 2.9% and January’s 3.0%, based on unadjusted figures. Meanwhile, core inflation, which excludes energy and food, rose 0.2% m/m in February. In annual terms, core inflation reached 3.1%, below the consensus estimate of 3.2% and the 3.3% recorded in the previous month. Overall, inflation figures were better than market expectations for both headline and core readings. In the coming months, the impact of the 25% steel and aluminum tariffs on inflation will need to be closely monitored.

Markets and Companies

U.S. stocks rebounded on Wednesday after a moderate inflation report eased concerns about the economy, prompting investors to buy beaten-down tech stocks. Over the past month, the S&P 500 has lost nearly -8%, while the Dow and Nasdaq have declined -6.6% and -11.3%, respectively.

European markets advanced following lower-than-expected U.S. inflation and the EU’s retaliation against Trump’s tariffs, while in Asia, performance was mixed due to tariff-related uncertainty and fears of a U.S. recession.

In commodities, oil prices edged higher on Wednesday morning, supported by a weaker dollar, though rising concerns over a U.S. economic slowdown and the impact of tariffs on global growth limited gains.

Gold remained stable before the release of the US´s key inflation report, while markets monitored a possible ceasefire in Ukraine.

In Mexico, the IPC is up 0.21%.

The exchange rate stands at 20.21 after closing at 20.27 yesterday.

Corporate News

• Groupon shares surged about 21% after its annual revenue guidance exceeded Wall Street expectations.

• Intel shares climbed 8% after Reuters reported that TSMC proposed a joint venture to U.S. chipmakers Nvidia, Advanced Micro Devices, and Broadcom to operate Intel’s foundry division. Nvidia, AMD, and Broadcom also rallied in pre-market trading.