Dollar retreats with tension relief in Brasília and inflation on the radar; Ibovespa goes up – Young Pan


Mercado continues to analyze Jair Bolsonaro’s signs of truce and efforts to advance the reform agenda

Adriana Toffetti/Estadão ContentDollar retreats this week beginning with the signal of harmony between the Powers

The main indicators of financial market Brazil closed this Monday, 13, in the positive field with the relief of tension between the Powers and despite the increase in expectations for inflation and interest rates. O dollar ended the day with a drop of 0.83%, quoted at R$5.224. The exchange rate reached a maximum of R$5.241, while the minimum did not exceed R$5.202. The US currency ended Friday, 10, with an advance of R$ 0.76%, to R$ 5.267. Following the optimism in the United States, the Ibovespa, a reference on the Brazilian Stock Exchange, closed with an increase of 1.85%, at 116,403 points. The last trading session of last week ended with a decrease of 0.93%, at 114,285 points.

Investors continue to analyze the developments in Brasília after tensions between the Powers have cooled. The market follows the impacts that the signal of truce by Jair Bolsonaro (no party) will have on economic agendas, such as the reform of the Income Tax and the solution for the payment of precatory scheduled for 2022. Groups against the government held a series of demonstrations this Sunday, 12, in various capitals of the country. Despite concentrating representatives from different political spectrums, the acts were smaller than those called by the president’s supporters on the September 7 holiday.

Also on the radar is the increase in expectations for the rise of the inflation and yes basic interest rate, while estimates with the economic recovery were revised downwards. Focus Bulletin data released on Monday pointed out that forecasts for the Extended Consumer Price Index (IPCA), the official inflation gauge, were changed to 8% by the end of this year, and 4.03% in 2022. Estimates with the Selic also rose to 8% per year in 2021 and 2022. The survey also showed the decline in expectations for the Gross Domestic Product (GDP). For this year, the forecast was downgraded to an advance of 5.04%, while for next year, the median indicated a high of 1.72%.