Dollar loses strength and retreats to R$5.23; Ibovespa retakes 125 thousand points – Prime Time Zone

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Exchange and Stock Exchange recover part of yesterday’s losses after strong global fears over the dissemination of the Delta variant of Covid-19

Brazil AgencyExchange returns part of the losses recorded the day before

The main indicators of the Brazilian financial market closed in the positive field this Tuesday, 20th, after a start to the week of strong losses due to the international bad mood. The dollar retreated 0.37%, quoted at R$5.231. The exchange rate reached the maximum of R$ 5,294, while the minimum was R$ 5,203. The currency was R$ 5,250 this Monday, 19, when registering an advance of 2.64% — the biggest daily increase since September 2020. Ibovespa, the main index of the Brazilian Stock Exchange, closed with a high of 0.81%, at 125,401 points. The previous day’s trading ended with a fall of 1.24%, at 124,394 points – the lowest value since the end of May.

Once again, the pace of international business had a great influence on the domestic market. Investors around the world reacted with strong risk aversion earlier this week with the increase in the number of Covid-19 cases in several countries due to the spread of the Delta variant of coronavirus. The new strain is considered more transmissible and already accounts for 83% of infections in the United States. Part of Wall Street indicators recovered part of the losses this Monday, pushing up business in Brazil. On a day without major index disclosures and with Congress in recess, the domestic agenda was taken by Jair Bolsonaro’s (non-party) declaration of vetoing the R$ 5.7 billion electoral fund. The amount is part of the Budget Guidelines Law (LDO) of 2022, approved by deputies and senators last week. The decision could clash with the interests of the Centrão and impact the approval of the reform agenda in the Legislative. Also in Brasília, investors followed the negotiations between the Ministry of Economy, Congress and economic sectors on the text of the tax reform, mainly in the section that includes a 20% tax on dividends.