The dollar operates with a sharp drop this Thursday (2), in a session marked by technical adjustments, due to the Labor Day holiday that kept Brazilian markets closed yesterday.
Last Wednesday (1st), the president of the Central Bank of the United States, Jerome Powell, stated that the Federal Reserve will maintain interest rates in the American economy at the current level for as long as necessary. The risk rating agency Moody’s reaffirmed Brazil’s credit risk rating at Ba2 and changed the country’s outlook from “stable” to “positive”.
What is the dollar exchange rate today?
The dollar in cash closed with a drop of 1.53%, at R$5.113 when buying and R$5.113 when selling, the biggest percentage decline in a single day since August 23rd of last year, when it dropped 1.63%. At 5:33 pm (Brasília time), the first maturity dollar futures contract fell 1.77%, equivalent to 5,125 points.
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Commercial dollar
Sale: R$5,113
Purchase: R$ 5,113
Tourism dollar
Sale: R$5,324
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Purchase: R$5,144
Read more: Types of dollars: find out the main ones and the importance of the currency
The North American currency plummeted against the real, in line with international risk appetite after the Federal Reserve (Fed) reinforced its view that it will cut interest rates this year, while, in Brazil, Moody’s raised Brazil’s outlook.
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Moody’s reaffirmed Brazil’s credit risk rating at Ba2 on Wednesday and changed the country’s outlook from “stable” to “positive”, according to a statement from the rating agency. According to Moody’s, the change in outlook to “positive” is supported by the assessment that “more robust growth, combined with continued, albeit gradual, progress towards fiscal consolidation, could enable the stabilization of the country’s debt burden. Brazil”.
Several market participants cited this development as positive for Brazilian assets, although they highlighted that this does not mean it is possible to lower one’s guard regarding the country’s fiscal health, with Moody’s itself citing “fiscal solidity is still relatively weak”.
Meanwhile, overseas, Fed officials unanimously decided Wednesday to keep interest rates in the 5.25% to 5.5% range they have been in since July. And although Fed Chair Jerome Powell has indicated that high inflation could delay the expected rate cut, he has refused to endorse discussions that the rate could actually be raised again.
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Guilerme Esquelbek, from Correparti Corretora, said that Powell’s speech brought relief to international markets, which recently postponed or even discarded bets on monetary easing by the North American central bank this year.
Higher interest rates in the US play in favor of the dollar, as they make US yields more attractive to foreign investors.
On Friday, the U.S. nonfarm employment report will come into investors’ focus as it could provide more clues about the health of the economy and the need for rate cuts.
On the local data front, Brazil’s current account deficit totaled US$4.6 billion in March 2024, almost the same level as in February and a much worse result than the surplus of US$698 million in March 2023. This figure also surpassed analysts’ LSEG consensus estimates, which projected a deficit of US$3.1 billion for the month.
For Banco Pine’s chief economist, Cristiano Oliveira, the solidity of external accounts and the lower political risk contributed to the change in the perspective of the Brazilian credit rating by Moody’s. “We maintain the estimate of appreciation of the real in the coming months due to the robustness of external accounts and lower sovereign risk”, says Oliveira, who predicts the exchange rate at R$4.85 at the end of the year.
In the afternoon, the BC announced that the exchange flow in April (until the 26th) is negative at US$ 741 million, with an outflow of US$ 10.635 billion through the financial channel overlapping the net inflow of US$ 9.893 billion via foreign trade. For the year, the total flow is still positive at US$4.021 billion.
(With Reuters)
