The dollar fell in early trading on Tuesday (30), extending its losses to a third consecutive trading session and approaching the psychological BRL 5 mark as the domestic foreign exchange market benefited from cash flow prospects, despite international fears. about a possible global recession remained on the radar of investors.
At 9:07 am (GMT), the spot dollar retreated 0.30%, to R$ 5.0180 on sale.
On B3, at 9:07 am (GMT), the dollar futures contract with the first maturity fell 0.30%, to R$ 5.0185.
This Monday (29), the commercial dollar fell to the lowest price since June 15 in the Brazilian exchange market. The American currency closed the session at R$ 5.033, which meant a 0.88% decrease in relation to last week’s closing.
In comparison with the main world currencies, the real was the one that gained the most strength.
The appreciation of raw materials exported by Brazil, mainly oil, and high interest rates on domestic fixed income attract dollars to the country, while international markets show losses with the prospect of a prolonged period of monetary tightening.
Threats to energy supplies caused by the Ukrainian War, in addition to other crises in oil-producing regions, have returned to raise concerns about supply in the coming months.
In Libya, clashes between militias threaten to halt oil shipments at a time when Europe’s energy crisis is worsening. Iran, another important producer, pointed to difficulties in concluding the nuclear agreement with the West, on which the increase in the flow of oil depends.
At the close of this Monday, the barrel of Brent oil rose 3.75%, to US$ 104.78 (R$ 528.33). This is the highest closing value since July 29.
Analysts interviewed by Reuters also highlighted that raw material producers in general are bringing resources into the country, in part due to the high interest paid by local fixed income.
Central Bank data for the week between August 15th and 19th show that the foreign exchange flow contracted for commercial operations had a surplus of US$ 1.1 billion (R$ 5.54 billion). It is the best result since the week ending July 1st.
Shares of Brazilian oil companies reflected the growth of investors’ bets on rising commodity prices.
On B3, the Brazilian Stock Exchange, the Ibovespa stock index sustained a slight increase of 0.02%, closing at 112,323 points.
Gains from Petrobras shares, which rose more than 2%, and from other companies in the sector helped to prevent the local market from being completely pulled to the bottom by the poor performance of the market abroad.
Stocks in the United States and Europe retreated on the expectation of a long period of monetary tightening by the Fed (Federal Reserve, the American central bank).
In New York, the benchmark S&P 500 index fell 0.67%. London and Frankfurt lost 0.70% and 0.61%, respectively.
On Friday (26), the market began to consider the prospect of higher interest rates in the United States after the speech of Fed President Jerome Powell in Jackson Hole.
At the central bank symposium, Powell made it clear that interest rates in the United States will continue to rise until inflation falls to a level considered safe, even if this causes a sharp slowdown in the economy.
“A failure to restore price stability would mean much greater pain,” Powell said on Friday.
Stock markets in major global economies plummeted after Powell’s speech.
Taking a short-term view, the market looked to the Jackson Hole symposium for clues about the size of the interest rate hike the Fed will approve at its Sept. 20-21 meeting.
In a scenario where the Fed considers the need to aggressively continue raising the rate, analysts estimate a 0.75 percentage point increase in the rate, currently at 2.5% per year.
This was the increase applied in the last two meetings of the monetary authority.
For those who expect a more lenient stance, the rate is expected to rise by 0.50 percentage point. After Powell’s speech, though, it’s possible that the 0.75% stakes will gain a little more traction.
In his speech this Friday in Jackson Hole, the chairman of the Fed emphasized that the tightening of the credit rate will “continue until the work is done”, addressing the speech precisely to the part of the market that is most optimistic about the possible proximity of the end of the interest rate hike in the US.
with Reuters
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