The exchange rate and the dollar begin the week with slight declines

The external scenario and the indication of speed in the elaboration of the fiscal framework were the main factors in the devaluation of the US currency

Sao Paulo – After a morning marked by signal changes, the dollar the spot stabilized on the downside throughout the afternoon in the domestic market amid deepening U.S. currency losses abroad, especially in relation to hard currencies, and statements from the Secretary of Institutional Relations (SRI) minister, Alexandre Padilha, who ruled out the possibility of a delay in addressing the new fiscal framework in Congress.

With a fluctuation of less than five cents between the high (R$ 5.0859), in the morning, and the low (R$ 5.0381), the spot dollar closed the session on Monday the 24th, quoted at BRL 5.0409falling from 0.35%, slightly adjusted lower after closing last week, which was shorter due to the Tiradentes party on Friday, with an appreciation of 2.92%. In the month the currency presents a loss of 0.55%. already the Ibovespathe benchmark index of B3, closed down by 0.40% at 103,946.58 points.

Traders point out that liquidity has been reduced, which has made the formation of the exchange rate more susceptible to specific movements. The main thermometer of appetite for business, the dollar futures contract for May recorded a turnover of just over 10 billion dollars. Investors would have avoided mounting more expressive positions given the agenda full of relevant indicators and events both here and abroad.

“We have to continue with this thin liquidity, with foreign investors withdrawn, because there is still a lot of uncertainty on the tax issue. There are doubts about the picture and there could be a delay in the calendar of votes in Congress with the CPI, which creates insecurity,” says the chief economist of Frente Corretora, Fabrizio Velloni.

Padilha said this afternoon that the possible establishment of a Joint Parliamentary Commission of Inquiry (CPMI) to investigate the January 8 coup plotters should not hinder the advancement of the government’s economic agenda in Congress, with a vote on the new framework tax in the Chamber of Deputies promised in mid-May. The minister praised the choice of deputy Cláudio Cajado (PP-BA) as rapporteur for the proposal. The prospect is that the application for the installation of the CPMI will be read on Wednesday the 26th.

There is great expectation for the presence tomorrow, 25th, of the president of the BC, Roberto Campos Neto, in a public hearing at the Senate Economic Affairs Commission (Cae). The HICP will be released on Wednesday 15th April. In Portugal, Lula once again criticized the management of monetary policy when he stated that “Brazil has a problem which is the very high interest rate”, which discourages investment and impedes consumption.

“The real depreciated last week, returning to the R$ 5.00 level, and should remain susceptible especially to political news. Not only are new economic signals expected, but also a reduction in political noise,” he said, reporting , Chief Economist of Armor Capital, Andrea Damico.

Abroad, the DXY index – which measures the performance of the dollar against a basket of six strong currencies – worked at a constant low, with a low around 101,300 points, with heavy losses against the euro, in the wake of tough speeches by European Central Bank (ECB) leaders.

This week’s agenda of American indicators sees the release of the first reading of US GDP in the first quarter and of the consumer price index (PCE), the measure of inflation preferred by the Federal Reserve, whose administrators are already in the so-called quiet period. The monetary policy meeting of the Central Bank of the United States will take place on May 3 and 4.

HANDBAG

The Ibovespa settled just below 104k points at the beginning of the week, in which the recovery of oil against recent losses – more than 5% last week – supported Petrobras shares (ON +1.54%, PN + 1.91%), while those of Vale (ON -3.62%) amplified the 3% drop in the price of iron ore in Dalian (China) on Monday. Bad day, albeit moderate, also for the shares of the big banks, another segment of weight on Ibovespa – the drop was between 0.21% (BB ON) and 0.93% (Santander Unit) in the session.

The benchmark index B3 thus closed down by 0.40%, at 103,946.58 points, on a day with few catalysts available, in which it fluctuated from 103,247.04 to 104,821.97, leaving the opening at 104,366.82 points. The turnover was R $ 24.7 billion. During the month, Ibovespa rose again by 2.03%, with a loss of 5.27% for the year.

The prudence seen in the session is justified by “important economic indicators in Europe and the United States, as well as expectations for the earnings reports of the big technology companies”, a combination of data and financial statements eagerly awaited by the market for the week, points in a note to Guide Investimentos. Pay close attention to the March PCE index, “the Fed’s most-watched inflation gauge,” due out Friday, notes Guide.

“In the US, investors remain alert to tomorrow’s release of results from ‘big techs’, such as Microsoft and Alphabet (Google). Q1 results could signal the tech giants’ financial health amid a challenging macroeconomic backdrop. Vale keep in mind that analysts have sharply revised downwards the earnings expectations of US companies, which leaves room for positive surprises, given the pessimistic forecasts,” says Álvaro Feres, analyst at Rico Investimentos.

Source: Terra

Rose

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