SÃO PAULO, SP (FOLHAPRESS)
The dollar was falling at the start of trading this Friday (22), giving back gains on an adjustment day after a strong rise in the previous session.
In the accumulated result for the week, however, the American currency is expected to appreciate, driven by the tough tone adopted by the Federal Reserve, the American central bank, regarding the next interest rate decisions in the United States.
At 9:39 am, the dollar fell 0.30%, quoted at R$4.919.
On Thursday (21), the Brazilian Stock Exchange registered a sharp drop, driven by abroad after signs of new interest rate increases in the USA and with market frustration over the next steps of monetary policy in Brazil. The Ibovespa ended the day down 2.14%, at 116,145 points.
The prospect of a tightening in American rates also gave strength to the dollar, which rose 1.12% and closed the session at R$4.934.
On Wednesday (20), the Copom (Monetary Policy Committee) made a 0.50 percentage point cut in the Selic (basic interest rate), in a decision without surprises. In its statement, however, the committee adopted a tougher tone and signaled that the next cuts should be of the same magnitude, frustrating market expectations about a possible acceleration of the pace.
On the same day, the Fed maintained interest rates in the range between 5.25% and 5.50%, but released a compilation of projections that shows that the majority of Fomc (American monetary policy committee) authorities foresee a new increase of 0. .25 percentage points later this year.
After the announcement of the Fed’s decision, American stock markets, which had been rising shortly before the announcement, reversed their gains and ended the day falling.
After the Copom was released, future interest rates, which include the Selic outlook, registered a significant increase, especially in longer terms. Contracts expiring in January 2025 went from 10.48% to 10.56%, while those for 2027 went from 10.39% to 10.52%.
“The interest rate reduction here was already expected by the market. As a result, the Fed’s hawkish speech yesterday ended up gaining prominence in future interest rates in Brazil”, says Elcio Cardozo, capital market specialist and partner at Matriz Capital.
In this scenario, the Brazilian Stock Exchange operated all day in a sharp decline, driven mainly by Vale, which fell 2.53%, also pressured by the decline in iron ore abroad.
The risk aversion movement in this Thursday’s trading session also affected Petrobras and PetroRio, which fell 1.60% and 4.35%, respectively, even on a day when oil prices rose. Both were among the most traded on the trading floor.
The biggest falls of the session, however, came from “small caps”, smaller companies linked to the domestic economy – and, therefore, more sensitive to interest rate movements. Magazine Luiza, Grupo Soma and Arezzo fell 6.74%, 6.70% and 5.71%, respectively, and the index that brings together these companies on B3 fell 2.59%.
Among the few highs of the day, Suzano rose 2.04% and was the session’s gains leader after announcing a readjustment of eucalyptus pulp. Klabim, another company in the sector, also had a positive day and rose 0.50%.
“The appreciation of the dollar benefited shares in the pulp and paper sector, as the rise in the US currency usually benefits exporting companies”, says Alexsandro Nishimura, economist and partner at Nomos.
Furthermore, Sabesp rose 2.03% with advances in its privatization process, and Natura rose 1.95% after the entry of two new companies in the sales negotiations of The Body Shop.
The post Dollar opens falling on day of adjustments after strong rise with Fed appeared first in Jornal de Brasília.
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