EM LATAM CREDIT: “Southern Copper 1Q Net Income Beats Estimates” – BBG

NATO Secretary General Mark Rutte has stated in remarks in Warsaw that the United States and Europe must avoid the urge to “go it alone” despite “questions about the strength of the transatlantic bond.”

• Rutte says although there has been “tough rhetoric” and “difficult debates between Europe and America,” this is "not the time to go it alone. Not for Europe or for North America. The global security challenges are too great… There is no alternative to NATO.”
• Rutte adds, likely in reference to recent suggestions that France and the UK could provide a European nuclear deterrence: “Nothing can replace America’s nuclear umbrella.”
• Rutte says he is “absolutely confident” the US remains committed to NATO and Article 5, citing President Trump’s statements affirming his support and “strong bipartisan support” in the US Congress.
• Rutte's comments come amid unprecedented strain within the alliance, with the EU and Canada bracing for additional tariffs on April 2, and comments by Trump administration officials in a leaked Signal chat group suggesting deep animosity towards Europe.
• The New York Times reports that Europeans reacted “with a mix of exasperation and anger” to the Signal story, noting that Europe, “has been on alert" since Vance's speech in Munich last month questioned European values and its democracy.
• One point of tension may have been defused. Vance is expected to visit a US airbase in Greenland tomorrow but the trip has been scaled back following a forceful response from Copenhagen and Nuuk.

While there were two-way swings over the Spring Statement, Chancellor Reeves will be happy with the market outcome, as gilt yields, BoE pricing and GBP FX are roughly in line with levels seen ahead of the event.

• Benchmark gilt yields are 3-6bp lower, trading closer to the bottom of their intraday ranges (which vary from 8.5-12.5bp).
• The slightly lower-than-expected gilt remit/fiscal readthrough from today provides no impediments to further BoE easing, leaving the Bank’s gradualist preference to policy loosening in play, further aided by today’s CPI data.
• Elsewhere, while the restored fiscal headroom is limited, and subject to erosion from modest downside surprises to near-term economic growth outcomes, the market is viewing that as a problem for another day.

• EUR/USD: $1.0750(E1.5bln), $1.0770-90(E719mln), $1.0800(E2.0bln), $1.0820-25(E1.4bln), $1.0850-65(E1.9bln)
• USD/JPY: Y150.00($684mln), Y155.00($902mln)
• GBP/USD: $1.2900(Gbp812mln)
• AUD/USD: $0.6220(A$717mln), $0.6450(A$771mln)
• USD/CNY: Cny7.2850($671mln)