The dollar begins Wednesday (27) trading above R$5, after highs in the last three trading sessions, while investors digest weaker-than-expected domestic inflation data.
The IPCA-15, considered the preview of official inflation, rose 1.73% in April, up from 0.95% in the previous month, informed the IBGE this Wednesday. A Reuters poll of economists estimated a rise of 1.85% for the period.
Close to 9 am, the dollar in cash advanced 0.48%, at R$ 5.0140 on sale. On B3, the first-maturity dollar futures contract rose 0.25% to R$5.0195.
The US currency closed the last session up 2.32%, at R$4.9899, ​​the highest value since March 18 (5.017), the last time it closed above R$5.
The Central Bank will auction up to 15,000 traditional foreign exchange swap contracts in this trading session for the purpose of rolling over the maturity date of June 1, 2022.
The day before, the commercial dollar rose 2.29%, quoted at R$4.99, a level that had not been frequented in a daily closing since March 18. After three days of strong increases, the American currency has gained 4.80% against the real this month, although it still has a fall of 10.5% in the year.
The real also had the biggest daily devaluation among the currencies of all countries, considering the spot return against the dollar in a list of 150 currencies compiled by the Bloomberg agency.
On the Brazilian Stock Exchange, the Ibovespa index plunged 2.23%, to 108,212 points, in a day of significant drops in the banking, technology and metallic commodities sectors.
Santander Brasil shares fell 4.55% after the institution reported results below expectations for the first quarter, contaminating Bradesco (-4.29%) and Itaú (-3.40%), which appeared after Vale (-1 .37%) and Petrobras (-0.17%) as the companies with the highest share of the Ibovespa fall.
In the domestic interest market, the DI (Interbank Deposits) rate for January 2023 rose from 12.945% to 13.005% between Monday and Tuesday. Contracts with longer maturities, between 2024 and 2031, also rose.
In the United States, the New York Stock Exchange’s reference index, the S&P 500, dropped 2.81%. Considerable losses occurred in the technology sector, with the Nasdaq indicator down 3.95%. This segment is more vulnerable to high interest rates, as it has companies that need credit to grow. The Dow Jones, made up of large value companies, fell 2.38%.
The stock index that tracks companies listed in the Chinese cities of Shanghai and Shenzhen dipped 0.81% after sinking 4.94% the previous day.
The world financial market has been working since last week on growing fears that restrictions on economic activities to combat the coronavirus in China will damage global supply chains, repeating a situation that occurred at the height of the pandemic.
The Asian region, in fact, faces a prospect of stagflation – the absence of economic growth at the same time that prices rise continuously –, warned an official at the IMF (International Monetary Fund) on Tuesday.
Inflationary risks due to the supply of products from Asia reinforced expectations that the Fed (Federal Reserve, the central bank of the United States) will aggressively raise interest rates to try to contain the highest inflation in the country in four decades.
Fears still hover over the market that an exaggerated dose of interest rate hikes to control inflation will lead the US economy into recession.
“The growing fear and discussion in the foreign market is about the pace of accommodation of the American economy until 2023. There will be a soft landing or recession”, commented Nicola Tingas, chief economist at Acrefi (association of credit and investment institutions).
“Domestically, the adjustment of external portfolios begins to indicate a reduction in the flow [de investimentos] to Brazil”, says the economist, highlighting the reason for the rise of the dollar against the real.
I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.
