Dollar opens higher, on a negative day due to a decision on interest rates in China

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The day before, the US currency fell 0.90%, sold at R$4.7751, a level it had not reached since June 3, 2022. Dollar Bills bearfotos/Freepik The dollar opened higher on Tuesday ( 20), on a day with an empty economic agenda in Brazil and with investors awaiting the decision on monetary policy, which should take place tomorrow, and with an eye on the progress of the text of the fiscal framework in Congress. Today, global markets are experiencing a more negative day, reflecting the cut in interest rates in China, which came in lower than expected. At 9:05 am, the US currency rose 0.33%, quoted at R$ 4.7910. See more quotes. The day before, the dollar fell 0.90% and closed short at R$4.7751, at the lowest level since June 3 of last year. As a result, the currency began to accumulate falls of: 5.87% in the month; 9.53% in the year. UNDERSTAND: What makes the dollar rise or fall in relation to the real COMMERCIAL X TOURISM: what is the difference between the quotation of foreign currencies and why is tourism more expensive? MONEY OR CARD? What’s the best way to take dollars on trips? DOLLAR: When is the best time to buy the currency? What is messing with the markets? Today begins the meeting of the Monetary Policy Committee (Copom) of the Central Bank of Brazil (BC), which lasts until tomorrow. The market expects the Selic, the basic interest rate, to remain at 13.75% per annum. It is widely projected by investors and analysts that the Copom will start reducing the Selic rate at the next committee meeting, in August. Still in the domestic scenario, another point of attention is the fiscal framework. The forecast is that the text of the government project will be presented and voted on today in the Federal Senate. Abroad, sentiment is more negative in this trading session due to the monetary policy decision in China. The government of the Asian country reduced the country’s interest rate by 0.10%, which fell from 4.30% to 4.20%. The decision displeased the market, which expected a sharper drop in interest rates, as a way for the government to stimulate the country’s economy, which has been going through a period of deceleration, according to the latest indicators released. The second largest economy in the world is the biggest demander for several products exported by several countries. Thus, if Chinese economic activity slows down, the impact can be felt at the global level – and therefore a larger drop in interest rates was expected. In addition, Federal Reserve (Fed, the US central bank) leaders are also expected to speak throughout the day, which may bring new signals about the direction of interest rates in the country.

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