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Dollar rises and reaches R$5.162 after US data; Stock market remains stable

Dollar rises and reaches R$5.162 after US data; Stock market remains stable
Dollar rises and reaches R$5.162 after US data; Stock market remains stable
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The dollar rose 0.28% and closed the day at R$5.162. During the month, the American currency now accumulates an increase of 2.93% against the real.

The Ibovespa had a slight drop of 0.08% and reached 124,645.58 points, in the third consecutive session of losses. The main B3 index fell 2.70% in April.

The value of the dollar reported daily by the press, including the UOL, refers to the commercial dollar (learn more by clicking here). For those who are going to travel and need to buy currency at exchange brokers, the reference is the tourist dollar, and the value is much higher.

What happened

US currency advanced with stronger inflation in the US. Data from Thursday (25) showed that United States economic growth slowed more than expected in the first quarter, but an acceleration in inflation suggests that the Federal Reserve will not cut interest rates anytime soon.

US Gross Domestic Product expanded at an annualized rate of 1.6% last quarter. The information is from the Department of Commerce. Economists polled by Reuters had forecast growth of 2.4%, with estimates ranging from a 1.0% pace to a 3.1% rate. Putting pressure on markets, data showed that the core PCE price index accelerated to 3.7% in the quarter, above expectations of 3.4%.

Global markets have experienced a wave of risk aversion recently. Resilient US data and tough talk from Fed officials led traders to predict just two cuts of 0.25 percentage points in US interest rates in 2024. Between the end of 2023 and the beginning of this year, markets even bet on up to 1.50 percentage points of monetary easing in the period.

Today’s robust indicator and corporate agenda guided Ibovespa. External uncertainty added to local fiscal risks and has affected monetary policy prospects, with the president of the Central Bank, Roberto Campos Neto, warning that there could be a slowdown in the pace of easing, which led to an increase in market projections to the Selic level at the end of this year.

Slow pace is positive for the real. In theory, a slower pace of monetary easing in Brazil would be positive for the real, as this would better preserve the profitability of the fixed income market, attracting foreign investors.

With a 7% drop in first quarter profit, Vale’s shares (VALE3) started this Thursday’s trading session on a downswing. The mining company reported on Wednesday night (24) earnings before interest, taxes, depreciation and amortization of US$3.438 billion, a drop of 7% compared to the first quarter of 2023. The number was also below what the market expected: US$3.6 billion.

Submission of tax reform. Marlon Glaciano, financial planner and finance specialist, assesses that although this suggests progress, there is still some caution, given the signs of progress in government spending and failure to meet the fiscal target. “Collection continues to grow, but there are still doubts about whether the fiscal target will be met. We don’t know how the money collected will be used, whether it will be used correctly. There is no point in promoting rules and not complying with them”, he assesses.

(With Estadão Conteúdo and Reuters)

The article is in Portuguese

Tags: Dollar rises reaches R5 .162 data Stock market remains stable

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