Impact of the war on the economy, quiz of the week and what matters in the market

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Quiz: the week at the markets

Another week is coming to an end – and what a week, huh? How about testing if you are up to date with some news that moved the economy and markets in recent days?

Russia vs Ukraine: How the War Affects Us

It happened. This Thursday morning (24) in Eastern Europe, Vladimir Putin decided to attack Ukraine. The reaction of the markets was immediate, and the impacts should be perceived by Brazilian consumers.

Understand: Earlier in the day, food and fuel prices soared. Fears of inflation, however, led Biden to avoid sanctions – at least for now – for oil and food, writes Vinicius Torres Freire, which helped to cool down commodity prices in the late afternoon.

The effects of the war on the economy:

Foods:

• Wheat: the two countries account for 30% of global cereal exports, which ended the trading session up by 5.7%. How it affects us: Brazil is one of the biggest wheat importers, that is, bread and pasta are among the items that should become more expensive in a few weeks.
• Corn: came to rise 5%, but closed up 1.6%. Ukrainians and Russians hold 19.5% of corn traded in the world. How it affects us: cereal is also used in animal feed, so meat must be more expensive.
• Fertilizers: Russia is Brazil’s main supplier, and fertilizer prices, which have already risen recently, are expected to go further with sanctions on the country led by Putin. How it affects us: affects several Brazilian crops, from coffee to soybeans.

Fuels:

• Petroleum: the barrel of the Brent type passed the US$ 100 mark shortly after Russia attacked Ukraine, reached US$ 105, and returned to the US$ 100 level late on Thursday night.
• The Russia, in addition to being one of the world’s largest producers of the commodity, it is also an important source of natural gas for Europe. With the prospect of lower energy supply, prices rise.
• Not now: Petrobras will not immediately pass on the increase to fuels and will wait for a definition of the scenario before making a decision. The market considers that gasoline and diesel prices were already out of step before this high.
• On inflation: oil is the commodity that has the most effect on inflation in Brazil, followed by agricultural commodities, according to an analysis by the Central Bank released at the end of last year.

Biden limits sanctions and calms markets

The first day of open markets after Russia’s attack on Ukraine was marked by extreme volatility.

Understand: at the opening of the day, stocks started to fall sharply, cryptocurrencies plummeted and oil soared.

As of 3 pm (GMT), the time of Biden’s statement indicating that the sanctions would not fully affect the supply of energy and food, the mood was reversed.

In numbers: in the US, Nasdaq soared 3.35%, helping to push the S&P500 higher by 1.50%. In Brazil, the Ibovespa dropped 2.57%, but closed 0.37%at 111,591 points.

• The dollar, on the other hand, ended the fifth with a strong rise of 2.01%, BRL 5.10, with investors looking for protection in the US currency. The rise in the currency worsens Brazilian inflation.
• In Russia, the main stock index melted 33.28%reaching the lowest price since 2017.
• Bitcoin, which plunged 8% in the morning, also recovered in the afternoon and was quoted at $38,452 (R$ 196,751) on Thursday night, with a high of 3%.

Sanctions: Biden focused the punishments on the deals of the biggest Russian banks and companies in US banks, including Gazprom, the state-owned oil and gas giant.

Take a break: miss the revelry?

Another carnival has arrived, but sanitary restrictions in large cities did not allow the traditional street parties – private parties, with tickets for up to R$ 700, are free.

The event that moves the entire country also plays an essential role in the country’s economy, generating income for a chain of workers, ranging from hotel services to street vendors and collectors.

to kill the longing da folia, the streaming brings together productions that show the importance of the biggest Brazilian popular party:

• “I’m Saving Myself for When Carnival Comes”: Toritama, in the countryside of Pernambuco, is the national jeans hub, a place where workers work more than 10 hours a day. But, during Carnival, one of the two days off in the year, the city stops. On Netflix.
• “O Father, O”: The plot takes place during a Carnival in Salvador and follows the lives of residents of a tenement in the center of the Bahian capital. On Globoplay.