Dollar jumps and stock market falls before interest rate decision in the US and holidays

SÃO PAULO, SP (FOLHAPRESS)

The dollar registered a firm rise this Tuesday (30), with a feeling of global caution prevailing before the Labor Day holiday in Brazil, on Wednesday (1st), when a new decision on interest rates will also be taken by the Fed (Federal Reserve, the American central bank).

Risk aversion also affects the Brazilian Stock Exchange, which was falling, driven mainly by the shares of Vale and Petrobras.

At 10:36 am, the dollar rose 0.87%, quoted at R$5.159, while the Ibovespa fell 0.55%, to 126,644 points.

“At the beginning of the day, the dollar is appreciating globally, with investors adopting more defensive stances ahead of the US interest rate decision and the holiday, which will also stop markets in the European and Asian regions,” said Diego Costa, head of foreign exchange for North and Northeast of B&T Câmbio.

“The future of interest rates remains uncertain, and volatility in the markets is expected to persist at least until the [presidente do Fed, Jerome] Powell speak out.”

Money markets expect the US central bank to keep interest rates at their current range of 5.25% to 5.50% at the end of its two-day meeting on Wednesday. Traders are pricing in just about 0.35 percentage points of interest rate cuts by the Fed this year, below the start of the year projection of 1.5 points, according to LSEG data.

The reduction in US monetary easing expectations came after a series of resilient economic and inflation data, which led to a sharp reversal in global risk appetite in April, although the mood improved somewhat towards the end of the month.

The dollar was on track to jump 2.90% against the real in the month, equivalent to an increase of almost 15 cents. If this gain is consolidated by the end of this Tuesday, the US currency will have recorded the strongest monthly gain since August last year (4.72%).

Although operators associated much of the domestic exchange rate depreciation with international uncertainties, especially coming from the Fed, a worsening in the perception of Brazil’s fiscal risk was also pointed out, after the government relaxed the 2025 primary result target.

Costa, from B&T, drew attention to the fact that this trading session features the Ptax formation from the end of April, which tends to make morning negotiations more unstable.

Ptax is an exchange rate calculated by the Central Bank that serves as a reference for the settlement of futures contracts. At the end of each month, financial agents usually try to direct it to levels that are more convenient for their positions, whether they are bought or sold in dollars.