Financial markets today: Fed and Copom decisions remain in focus

This week’s heavy agenda brings a series of monetary policy decisions, with emphasis on that of the Federal Reserve (Fed, the American central bank), but the outcomes of the meetings of the Monetary Policy Committee (Copom), Bank of England are also expected. (BoE), Bank of Japan (BoJ), in addition to the Bcs of Mexico, Australia, Turkey and Russia. The president of the Fed, Jerome Powell, speaks twice a week, once at the press conference following the decision of the American Central Bank, on Wednesday. In Brazil, today the IGP-10 for March and IBC-Br for January will be released, in addition to the balance sheets of Braskem, Itaúsa and Magazine Luiza, after the markets close. President Luiz Inácio Lula da Silva will hold the first ministerial meeting of the year today to demand from the team the progress of programs and actions at a time when polls indicate a drop in his popularity.

Exterior

The mood is mixed on international stock exchanges in the week of decisions by several BCs. New York futures operate without a single direction, but in Europe the stock markets rise. In the euro zone, the consumer price index (CPI) slowed to 2.6% in February, from 2.8% in January, and the core rose 3.1% year-on-year, from 3.3% in January, within schedule in both cases.

In Russia, President Vladimir Putin was re-elected president again and will remain in power until 2030. In Asia, stock markets rose after better indicators from China. Industrial production, retail sales and fixed asset investment in the world’s second-largest economy rose more than expected in the first two months of the year, but China’s real estate sector remains a focus of concern.

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Monday could be positive for the Ibovespa amid the advance of most international stock markets, in addition to the rise in oil and iron ore, which rose 0.94% today in Dalian, China. EWZ, Brazil’s largest paper index fund traded in New York, rose 0.90% in pre-market trading at around 7:30 am. The market looks at the IBC-Br and the IGP-10, but great expectations lie with the decisions of the Fed and the Copom.

Fiscally, the Lula government may need to block R$5 billion to R$15 billion from the Budget to meet the expenditure limit of the new fiscal framework, according to technicians interviewed by Folha de São Paulo. Treasury Fiscal Projections Report, released on Friday, revealed that, although market projections still cast doubt on the government’s ability to raise what is necessary to achieve the zero deficit target this year, the Treasury updated the amount from R$168, 5 billion to R$170.8 billion the potential of the additional revenue package prepared for 2024. The Treasury also pointed out that, without additional measures to increase revenue, the government would not be able to meet the goal of generating a surplus in the 2025 primary result and 2026.

*State Agency