• Meanwhile in markets, all eyes are on US–Iran ceasefire talks in Islamabad, though we will have to wait a little longer as they will only begin Saturday morning (local time). President Trump’s optimism ahead of the talks has lifted stock markets, though bond markets are somewhat cautious;

• That said, it is not pure optimism – on Truth Social, Trump warned Iran against charging transit fees in the Strait of Hormuz, though he demanded that if they were already charging fees, they had a chance to stop. As we read between the lines yesterday, President Trump and VP Vance now both publicly stated Israel will scale back operations in Lebanon that threatened to blow up the agreement. Despite reported overnight breaches – with drone interceptions over Kuwait – the fragile ceasefire is holding, neither side appears willing to derail a chance of peace at this stage;

• Shifting to markets, Brent crude is trading at $96 a barrel, holding within yesterday’s range. Recent strikes on Saudi Arabia’s East–West pipeline that circumvents the Strait of Hormuz – reportedly during the ceasefire – caused more damage than initially thought, cutting throughput by 10 percent (or 700,000 barrels a day). Oil prices, however, have already retreated from the initial spike;

• Moving to other markets, Asian equities are higher ahead of ceasefire talks, with the Nikkei and CSI 300 up nearly two percent and the Hang Seng just under one percent. While S&P 500 futures are flat on the day, Stoxx 50 futures are up over half a percent today. US Treasury yields are up 2bps across the curve, with the broad dollar edges slightly higher this morning;

• Turning to overnight news, Russia and Ukraine are holding an Easter truce from Saturday afternoon throughout Sunday. Elsewhere, Hungarian Prime Minister Orban warned that backing change in the elections would be dangerous ahead of Sunday’s vote – though polls expect exactly that to happen with the opposition leading comfortably;

• Hungarian equity markets are also moving in anticipation of an Orban loss: the company 4iG is down nearly 50 percent YTD and Opus Global around 20 percent. Both are reportedly heavily reliant on revenues from government contracts awarded by Orban and his henchmen in the current government. The BUX index – of which they are constituents – is up 15 percent YTD, though it should be noted one bank makes up over forty percent of the index;

• Looking ahead, the US March CPI release is due at 14:30 CET. Consensus sees core CPI rising 0.3 percent MoM and 2.7 percent YoY. The Cleveland Fed nowcast tracks core CPI at 2.58 percent annualized in Q2, seemingly undisturbed by the Iran inflation spike, while headline is expected to rise much harder to 4.72 percent in Q2. The Fed’s preferred gauge, core PCE, is tracking at 0.24 percent MoM and 3.12 percent YoY for March.

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