With ‘foreign’ agro, trade surplus is not enough – 7/2/2023 – Nelson de Sá

The Chief Economist of the World Banking Association, robin brooks, a reference in social media for Faria Lima and the global financial market, continues to bet on Brazil. But now he informs that, even “with the enormous trade surpluses [em vermelho, no gráfico]the current account [em preto] still not in surplus”.

He explains that this is because “much of the agribusiness that drives exports is foreign-owned, so there are large dividend and interest payments [em laranja] going abroad”. He believes that “this flow will decrease over time” and that “it has already started the transformation of Brazil in a country with a current account surplus”.

CORPORATE DEBT STACK

The Frenchman Le Monde returns to the Americanas case, “one of the most serious scandals in the history of Brazil”, and Bloomberg uses it to warn that the economy has difficulties on the way, on the corporate front.

Under the heading “Nervous traders push pile of distressed debt to $12 billion”, Bloomberg notes that the jump in this corporate debt is at 26% on the year and “companies face a wall of maturities in 2025 and 26”. Text:

“Investors have become more and more anxious about bonds since the historic crash of Americanas, unloading corporate debt at the slightest hint of stress. Highly leveraged companies struggle to pay creditors and cover expenses after the Central Bank raised interest rates by just 2% to 13.75% and Americanas imploded. The increase in debt trading signals a growing risk of restructuring and defaults by companies that borrowed heavily when interest rates were low.”

On the other hand, Reuters (below) and the same Bloomberg project that the reduction of interest rates in the world may start in Latin America, first Chile, then Brazil.

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