The spot dollar closed at a high in Brazil on Tuesday, breaking a run of three consecutive sessions of decline, with prices in line with the North American currency’s advance against other foreign currencies on a day marked by new rising U.S. bond yields.
The cash dollar ended the day at 4.9068 reais, up 0.76%. In January the US currency gained 1.14%.
On B3, as of 5:12 pm (Brasilia time), the front-month dollar futures contract rose 0.72% to 4.9195 reais.
Professionals interviewed by Reuters said the renewed rise in Treasury yields, on the perception that the chances that the Federal Reserve will not cut interest rates in March have increased, had strengthened the U.S. currency around the world, including in Brazil.
“The market continues to await the reading of inflation indices this week, here and in the US,” said the director of currency consultancy FB Capital, Fernando Bergallo.
“The weak agenda (indicators) (today) and weak turnover also leave the market with less liquidity and, therefore, a little more sensitive to the impact of trading operations,” he added.
Investors await the release of the US consumer price index (CPI) on Thursday and the first North American corporate balance sheets on Friday to assess the direction of the economy and, in parallel, the future of the Fed’s monetary policy. As a result, they could there be changes in the most relevant positions in the markets, including the exchange rate.
In Brazil, the highlight will be the release of official inflation on Thursday.
Even though the dollar rose on Tuesday, some market professionals continue to argue that the near-term trend of the US currency is bearish relative to the real, considering the still high levels of the Selic base rate and the prospect of the Fed starting to cut the interest rates. at some point this year.
Domestically, this Tuesday investors followed negotiations on the government’s proposal to increase company employees, a factor that did not affect the foreign exchange market.
Senate President Rodrigo Pacheco (PSD-MG) said the extension of the payroll tax exemption for sectors of the economy was a decision of Congress and it was unlikely that revoking the benefit would advance the Legislature. However, he stated that he will not make any decisions on the proposal before speaking with the Minister of Finance, Fernando Haddad.
In the morning the Central Bank sold all 16,000 traditional currency swap contracts offered with the renewal of the March maturities.
At 5.12pm (Brasilia time), the dollar index – which measures the performance of the US currency against a basket of six currencies – rose 0.22% to 102.520.
Source: Terra
Rose James is a Gossipify movie and series reviewer known for her in-depth analysis and unique perspective on the latest releases. With a background in film studies, she provides engaging and informative reviews, and keeps readers up to date with industry trends and emerging talents.
