LATAM: BCB Still on Course for Cautious Start to Easing Cycle Next Week

* Despite the stabilisation of core rates over the course of today's session, Brazilian DI swap rates have remained on the backfoot on Monday, with front end yields up a further 13-15bp (albeit well below earlier session highs). The move takes total gains over the last week to ~60bp, leaving the market pricing in a cautious 25bp initial Selic rate cut next week. * This comes after today's BCB Focus survey showed that 2026 CPI expectations remained unchanged for a second week running. Despite moderating in recent months, BCB director Nilton David reiterated last week that inflation expectations remain unanchored and still far from target. Nonetheless, David also said that the BCB's guidance for a start to the easing cycle on March 18 remains valid. * Elsewhere, Mexico TIIE-F swap rates have also underperformed, with long-end yields up 5-8bp after core CPI inflation remained persistent in February, reducing prospects for a renewed Banxico rate cut on March 26. More positively, Economy Minister Ebrard said that Mexico will start bilateral USMCA talks with Canada in May, and hopes for steel and aluminium tariff relief by July. * In contrast, Colombian swap rates have outperformed, with yields down as much as 20bp today, as sentiment has been buoyed by the decisive victory of centre-right candidate Paloma Valencia in Sunday's presidential primaries. Senator Valencia now joins fellow right-wing candidate Abelardo de la Espriella as one of the front-runners for the May election, although left-wing Senator Cepeda is still favourite for now. Softer CPI data also buoyed sentiment, although BanRep still looks set to hike rates further on March 31.

SECURITY: Ukraine Peace Talks Postponed At Request Of US - Zelenskyy

Ukrainian President Volodymyr Zelenskyy said in a statement on X: https://x.com/ZelenskyyUa/status/2031046945687433636?s=20 that a planned trilateral meeting with Russian and US negotiators has been postponed in light of the war in the Middle East, accusing Russia of trying to "manipulate" the conflict "in favor of their aggression." The statement supports a prevailing view that the war in Iran is likely to significantly decrease the prospect of a diplomatic breakthrough in Ukraine. * Zelenskyy said, "At the moment, the partners' priority and all attention are focused on the situation around Iran, and because of this the meeting that had been planned for this week is being postponed at the proposal of the American side.... However, Ukraine is ready for a meeting at any moment, in a format that can help and that will be realistic in terms of ending the war..." * Zelenskyy continued, "We see that the Russians are now trying to manipulate the situation in the Middle East and the Gulf region in favor of their aggression, and also to effectively turn the Iranian regime's strikes against its neighbors and American bases into a second front of Russia's war against Ukraine and, more broadly, against the entire West." * Responsible Statecraft noted : https://responsiblestatecraft.org/iran-war-affects-ukraine-peace/earlier today, "The conflict in Iran probably won't alter the long-term trajectory of Russia's special military operation. It will, however, prolong the fighting and make it harder to reach a ceasefire." * Zelenskyy confirmed yesterday that Ukrainian operatives have been dispatched to the Gulf to advise on counterdrone operations, which Kyiv sees as potentially increasing leverage in future arms tranfers.

CZECHIA: CNB's Seidler Says Bar for a Hike is "Very High"

Comments from CNB's Jakub Seidler interview with Reuters below (published earlier this afternoon): * "In my view, the discussion about a potential CNB hike is very premature and the bar for a hike is very high here." - Reuters * "Stability of rates seems to be the most appropriate stance." * "Even if we stay in a little bit longer-term situation with elevated oil prices and elevated gas prices, I think that the chance that inflation will stay in our tolerance band is very high" * "If the situation de-escalates, and I will see this momentum slowing down even in forthcoming (services inflation) figures, I can imagine that I will also support (a cut)"

LATAM FX: On a Firmer Footing as Risk Sentiment Stabilises

* Latin American currencies are trading in a more resilient manner on Monday, as risk sentiment has stabilised and the US dollar has unwound earlier gains amid a pullback in crude from session highs. BRL is outperforming (+0.5%), while MXN has also now tilted into positive territory on the session. CLP is slightly lagging peers (-0.2%), but has pared most of the day's losses amid a recovery in copper: * For USDBRL, a medium-term bearish theme remains intact, although the recent bounce does highlight the start of a corrective phase. A clear break of 50-day EMA resistance (at 5.2666) would signal scope for a stronger recovery, towards 5.4237, the Jan 14 high. Key support and the bear trigger lies at 5.1157, the Feb 27 low. * Similarly for USDMXN, the recent breach of the 50-day EMA (at 17.5337) signals scope for a stronger recovery towards 18.1273 next, a Fibonacci retracement point. The 50-day EMA is first support. * The medium-term trend condition in USDCLP also remains bearish, although the break higher last week signals the start of a stronger corrective phase. Sights remain on 932.94 next, the 61.8% retracement of the Jul 30 '25 - Feb 9 bear leg. Initial firm support is 884.38, the 50-day EMA.