Dollar has its second consecutive rise and closes at R$5.09, with US inflation still on the radar; Ibovespa falls

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The North American currency advanced 0.25%, quoted at R$5.0900, reaching its highest level in six months. The main stock index on the Brazilian stock exchange closed down 0.51%, at 127,396 points. Roberto Campos Neto, on inflation: “We had good news locally, and bad news in the external scenario” The dollar closed higher this Thursday (11), as investors still reflected the advances in the producer and consumer price indices of the U.S. The indicators once again brought expectations about the next steps of the Federal Reserve (Fed, the US central bank) in North American monetary policy. Ibovespa, the main stock index on the Brazilian stock exchange, B3, ended in decline. See below for a summary of the markets. Dollar At the end of the session, the dollar rose 0.25%, quoted at R$5.0900, renewing its highest level since October. At its maximum, it was R$5.0910. See more quotes. With the result, it accumulates increases of: 0.50% in the week; 1.49% in the month; and 4.89% in the year. The day before, the US currency rose 1.41%, quoted at R$5.0774. Ibovespa Ibovespa closed down 0.51%, at 127,396 points. With the result, it accumulates: increase of 0.48% in the week; drop of 0.55% in the month; and a decline of 5.06% in the year. On Wednesday, the index closed down 1.41%, at 128,054 points. Understand what makes the dollar rise or fall CASH OR CARD? What is the best way to take dollars when traveling? DOLLAR: When is the best time to buy the currency? What’s moving the markets? This week’s main highlight continues with inflation indicators in the United States. On the agenda this Thursday (11), the focus was on the North American producer price index, released by the US Department of Labor. The indicator registered an increase of 0.2% in March, after an increase of 0.6% in February. Although the result was slightly lower than expected by economists consulted by Reuters, who predicted an increase of 0.3%, the number still represents an increase in North American prices and once again raises expectations about the Fed’s next steps. The day before, for example, the consumer price index (CPI) in the United States accelerated and reached 3.5% in March, against 3.2% recorded in February and above market expectations. The numbers increase fears that the Fed may take longer to start the interest rate cut cycle in the country. The US central bank has an inflation target of 2% and, following stronger than expected job growth in March, as well as the unemployment rate falling from 3.9% in February to 3.8%, Some economists postponed interest rate cut expectations to July. After the indicators, financial markets saw a roughly 84.8% probability of the Fed maintaining interest rates at its June 11-12 policy meeting, according to CME’s FedWatch tool. Corroborating this scenario, Fed authorities continue to be concerned about the possibility that the inflation control process has stagnated and that a longer period of restrictive monetary policy is necessary to control the pace of price increases. “In general, participants highlighted their uncertainty about the persistence of high inflation and expressed the view that recent data had not increased their confidence that inflation is moving sustainably towards 2%,” said the minutes of the last meeting from the Fed, also released yesterday Fed officials are debating whether the biggest risk is that monetary policy remains too tight for too long or that the rate cut comes too soon and fails to return inflation to its target of 2 %. In Brazil, the focus is on the news of the day, amid debates about reducing the price of electricity. The day before, President Luiz Inácio Lula da Silva (PT) asked for the presentation of a new energy program later this year, to structurally reduce the price of energy tariffs, according to g1. The president even met with representatives from the electricity sector, the Ministry of Mines and Energy (MME) and the Civil House. On the agenda: reducing tariffs. As a result of the meeting, the MME was responsible for leading a working group to prepare a structural proposal for the sector until the end of 2024. In addition, investors continue to reflect on the Broad National Consumer Price Index (IPCA), released in Eve. The country’s official inflation showed that prices rose 0.16% in March, below financial market expectations. The biggest impact of the month came again from the Food and beverages group, with an increase of 0.53% and a weight of 0.11 percentage points (pp) in the general index. But it is a smaller monthly variation than in February, when the group’s prices had risen 0.93%. For the financial market, inflation came in well below projections, but it still does not eliminate concerns about inflation in services. Underlying services, a core focused on services and excluding more volatile items, rose slightly stronger than the previous month, from 0.44% to 0.45%. “The point of concern continues to be the underlying services, which, while remaining practically stable, remain at a level incompatible with inflation targets – and should continue to justify the Central Bank’s caution”, says Helena Veronese, chief economist at B Side. Still on the corporate agenda, attention continues with the news involving Petrobras. Last week, rumors resurfaced in the market that the president of the state-owned company, Jean Paul Prates, could be fired from the company and replaced by the current president of BNDES, Aloizio Mercadante. The news that the government also decided to pay part of Petrobras’ dividends, an issue that was the subject of a crisis with Prates, also continued to be in the spotlight. According to Julia Duailibi’s blog, half of the dividends will be paid, a value of around R$20 billion. *With information from Reuters news agency.

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