LOCAL ASSETS CLOSED WITH A POSITIVE PERFORMANCE in a session marked by easing geopolitical tensions. Dollar-denominated bonds reversed early losses and finished higher, compressing country risk to 519 bps, while peso-denominated debt traded steadily with slight gains in dual-indexed and fixed-rate instruments. The official exchange rate and financial exchange rates retreated in a session featuring renewed BCRA purchases and an increase in gross reserves. It was also a strong session for equities, driven by the banking sector. In addition, the March economic activity data was released, showing growth relative to the previous month.

ARS-DENOMINATED DEBT POSTED A STEADY SESSION, with dual-indexed instruments leading gains, rising 0.6%. Fixed-rate instruments followed with a more moderate advance, while CER-linked bonds closed mostly in positive territory with slight losses in the middle of the curve. Dollar-linked instruments fell 0.1%.

DOLLAR-DENOMINATED DEBT OPENED WITH LOSSES that were reversed throughout the session as Middle East tensions eased, closing with an average gain of 0.2%. The long end posted gains of up to 1.3%, while the short end advanced up to 0.7%. With this performance, country risk retreated again to 519 bps. Bopreals lagged, falling 0.7%.

THE OFFICIAL EXCHANGE RATE FELL 0.5%, closing at ARS 1,392.17, sitting 25.1% below the upper band ceiling. Financial exchange rates also declined: the MEP rate fell 0.7% and the financial dollar dropped 0.5%, closing at ARS 1,421.2 and ARS 1,480.8, respectively, while the spread between them widened to 4.2%. The BCRA purchased USD 145M in the session, accumulating USD 1,696M for the month and USD 8,851M year-to-date. Gross reserves rose USD 168M, closing at USD 46,751M.

THE MERVAL ADVANCED 3.1% IN PESOS AND 3.5% IN USD, reaching USD 1,941. The rally was driven by the banking, utilities, and materials sectors. The top performers were Banco Macro, BBVA, and Supervielle, with gains ranging from 6.6% to 8.6%. The underperformers were Transener, ByMA, and VALO, each falling 0.9%. For stocks listed on Wall Street, the average gain was 3.1%, led by BBVA, Macro, and Supervielle, with advances of between 7.3% and 8.8%. The only decliner was Globant, which fell 2.8%.

IN MARCH, ECONOMIC ACTIVITY AS MEASURED BY THE EMAE GREW 5.5% YEAR-OVER-YEAR and 3.5% in seasonally adjusted terms relative to February. Growth was driven primarily by Agriculture, livestock, hunting and forestry (+17.9% y/y), Manufacturing (+4.6% y/y), and Mining and quarrying (+16.3% y/y), which together contributed 2.7 percentage points to overall growth. On the downside, only Public administration and defense (-1.2% y/y) subtracted 0.1 p.p., leaving broad-based and solid expansion. With this result, activity accumulated growth of 1.7% y/y in the first quarter of the year.