Ibovespa opens at a record high, with an eye on the Copom minutes; dollar operates in decline

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The main stock market index rose 0.68%, to 131,084 points, a new historical record. The North American currency fell 0.65%, quoted at R$4.9047. KEVIN DAVID/A7 PRESS/ESTADÃO CONTÚDO Ibovespa, the main stock index on the São Paulo stock exchange, operates on the rise this Tuesday (19), after breaking a historic record the day before. The highlight of the agenda is the release of the minutes of the last meeting of the Monetary Policy Committee (Copom), held last week. The Central Bank states that it will continue the process of cutting interest rates in 2024 and reinforced the message that it is important for the federal government to continue seeking the targets indicated for public accounts. (learn more below) The dollar is falling, close to R$4.85. See the day in the markets below. Understand what makes the dollar rise or fall Dollar At 10 am, the dollar was trading down 0.82%, quoted at R$4.8644. See more quotes. Yesterday, the North American currency closed down 0.65%, sold at R$4.9047. With today’s result, it began to accumulate falls of: 0.65% in the week; 0.21% in the month; 7.07% in the year. Ibovespa At the same time, Ibovespa was up 0.38%, at 131,579 points. The day before, the index closed with an increase of 0.68%, at 131,084 points, renewing its historic high. As a result, it accumulated gains of: 0.68% in the week; 0.21% in the month; 19.46% in the year. READ ALSO 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? The Central Bank published this Tuesday the Copom minutes, in which the BC reaffirms the intention and pace of interest cuts, and makes new mention of the importance of preserving the target of zero deficit in public accounts. “With regard to the fiscal scenario, taking into account the importance of implementing the fiscal targets already established for anchoring inflation expectations and, consequently, for the conduct of monetary policy, the Committee reaffirms the importance of firmly pursuing these targets”, he assessed the BC. The logic is that, without achieving the fiscal target, the government contributes to increasing the amount of resources available in the economy – and, consequently, there is more difficulty in reaching the inflation targets set for 2024 and 2025. The institution reiterated the vision that a possible “fading” in the effort towards structural reforms and fiscal discipline, as well as the increase in targeted credit (BNDES, rural and housing, with lower interest rates) and uncertainties about the stabilization of public debt have the potential to raise the rate neutral interest rate of the economy (which controls inflation and allows GDP growth). The text also cites, as a consequence of this scenario, possible “deleterious impacts on the power of monetary policy [de definição da taxa de juros] and, consequently, on the cost of disinflation in terms of activity.” “The most important excerpt in the minutes is when the Copom highlights that ‘the prospective evolution of the output gap and the dynamics of the labor market will be very relevant in determining the speed with which inflation will reach the target'”, says Nicolas Borsoi, chief economist at Nova Futura. “That is, the Copom will only change its plans if the economy experiences a more intense slowdown, which could lead to a further drop in inflation. quickly, which would have an impact on the process of re-anchoring expectations.” On the corporate agenda, emphasis on the Creditors’ Assembly of Americanas. The retail chain responsible for one of the largest requests for judicial recovery in the history of Brazil. The company announced in the early hours of this Tuesday that Banco do Brasil, Caixa Econômica Federal, Banco da Amazônia and other creditors accepted an agreement to support the company’s judicial recovery plan, scheduled to go to vote at a meeting this afternoon. In addition to BB and Caixa, “several other holders of the company’s securities” also joined the agreement. With the new additions to the support agreement, called PSA by Americanas, the company’s judicial recovery plan includes adherence to “a portion significantly greater than 60% of the company’s debt.” Abroad, speeches from members of the Federal Reserve (Fed, US central bank) are still echoing about last week’s decision to keep US interest rates unchanged. Yesterday, the presidents of the Cleveland and Chicago districts spoke. Loretta Mester, from Cleveland, believes that interest rate cuts will not happen in the short term, since the central discussion is still knowing how long interest rates will have to stay at the current level of 5.25% to 5.5%. Austan Goolsbee of Chicago, one of the most “dovish” voices on the current Fed committee, celebrated the progress on inflation but said he was “confused” by the market’s reaction to the rate decision and Chairman Jerome Powell’s press conference last week. READ TOO

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