Dollar fluctuates, but could close the biggest quarterly drop since 2009

The dollar fluctuated close to stability on Thursday morning (31), in a session that promises to be volatile due to the formation of the Ptax rate at the end of March, with the US currency on track to record its worst monthly performance against the real. since October 2018 and the biggest quarterly drop since the period from April to June 2009.

At 9:08 am (Brasília time), the spot dollar was stable, at R$ 4.7855 on sale.

On B3, at 9:08 am (GMT), the first-maturity dollar futures contract rose 0.25% to R$4.7840.

The US spot currency closed the last session up 0.59%, at R$ 4.7855 on sale.

Oil prices plunged 5.09% this Thursday morning (31), with the Brent barrel traded at US$ 107.68 (R$ 511.38).

Biden’s administration is evaluating a plan to release approximately one million barrels of oil a day from strategic US reserves, sources close to the US president’s administration told Bloomberg news agency.

Up to 180 million barrels could be released over a few months. The plan is to use the reserves to fight fuel inflation, which was accelerated by the strong appreciation of the raw material since the beginning of Russia’s invasion of Ukraine.

The Americans also plan to lead other countries in releasing their strategic reserves, which would massively expand supply and push prices down.

The commodity’s appreciation is one of the main symptoms of the market’s view that sanctions on Russia, one of the main exporters of oil and natural gas, could reduce supply for a long period, giving breath to the rise in global inflation.

Germany activated its emergency plan to secure gas supplies in the face of threats to stop Russian supplies.

This Wednesday (30), the benchmark index of the Stock Exchange managed to sustain a slight increase of 0.20%, to 120,259 points, supported mainly by the commodities sector. With that, the Ibovespa maintained the level of 120 thousand points reached the day before.

The dollar, however, closed up 0.58%, quoted at R$4.7850. The devaluation of the Brazilian currency was against the gains presented by the main currencies of developed and emerging countries against the American currency.

Market participants told Reuters that the dollar’s rise in the last session is mainly related to the approach of the last day of the month and the first quarter, when the Central Bank calculates Ptax. It is an exchange rate that serves as a reference for the settlement of derivatives.

At the end of each month, financial agents usually try to direct it to levels more convenient to their positions, and, this Wednesday, those long in dollars – which bet on the appreciation of the American currency – prevailed.

Economist Igor Lucena also attributed the rise in the dollar on Wednesday to a momentary movement of foreign investors towards assets linked to the US currency, which offer greater security in times of increased global risks, such as US Treasury bonds. .

With the continuation of the war putting pressure on inflation, the potential for these securities to return grows due to the need to raise interest rates to contain the rise in prices.

“Despite a downtrend [do dólar frente ao real] since the beginning of the year, at times, we have these upward movements. This occurs when, for example, investors realize that the war is not going to end anytime soon and, as a result, they flee to inflation-linked and currency-linked papers,” he commented.

A day after negotiations between representatives of Russia and Ukraine raised expectations about a truce in the war due to some advances in negotiations held on Tuesday (29), market hopes about the reduction of economic risks generated by the conflict faded.

Despite promises of a “drastic reduction” in Russian military activity in Kiev and Chernihiv, Ukrainian officials reported attacks on the outskirts of both cities and elsewhere in the country. Stocks in Europe and the United States closed lower.

In New York, the S&P 500 index, the benchmark for US stocks, dropped 0.63%. The Dow Jones and Nasdaq indicators lost 0.19% and 1.21%, respectively.

In Europe, the indicator that tracks the 50 largest companies in the euro zone lost 1.08%. The Paris and Frankfurt Stock Exchanges fell by 0.74% and 1.45%, in that order. London rose 0.55%.

“We are skeptical about hope,” Morgan Stanley chief investment officer Lisa Shalett told Bloomberg television after Kremlin spokesman Dmitry Peskov said there was still a lot of work to do before a deal with the Ukraine, reinforcing the difficulties to reach the ceasefire.

Despite signs of recovery in the last few days of the American market, revealing the desire of investors to “buy low” after a process of correction of the highs of 2021, the risk for investments is a reality in the face of a geopolitical problem, according to Shalett.

with Reuters