The dollar rose more than 1% this Thursday (9), after the decision divided by the slowdown in the pace of cutting the Selic rate the day before raised concerns about changes in the profile of the collegiate, with the Monetary Policy Committee (Copom) also highlighting in its statement very uncertain international and domestic scenarios.
At 11:53 am (Brasília time), the dollar in cash rose 1.42%, to R$5.1621 on sale.
The Central Bank decided the day before to cut the Selic rate by 0.25 percentage points, to 10.50% per year, interrupting a sequence of six consecutive reductions of half a percentage point and abandoning its indication on the future of basic interest rates.
READ MORE: Selic at 10.50% – the four indicated by the Lula government voted for a greater drop, of 0.50pp
According to market participants, what had the biggest impact on risk appetite was the division in the decision, which for many reveals a worrying political bias.
According to the Copom statement, the 0.25 point reduction was supported by president Roberto Campos Neto and directors Carolina Barros, Diogo Guillen, Otávio Damaso and Renato Gomes. Nominated by President Luiz Inácio Lula da Silva, Ailton de Aquino, Gabriel Galípolo, Paulo Picchetti and Rodrigo Teixeira voted for a larger cut, of 0.50 percentage points.
According to Alfredo Menezes, partner at the management company Armor Capital, the fact that all those appointed by the government voted for greater monetary flexibility “may convey the perception that the new BC in January will be greatly influenced by the Executive Branch”.
Luciano Rostagno, chief strategist and partner at EPS Investimentos, drew attention to the complexity of the situation, as the dollar advances after a smaller interest rate cut that should, in fact, favor the real. This is because the local currency becomes more attractive to foreign investors when Brazil offers higher yields.
According to Rostagno, although a group of directors who prioritize controlling inflation – and who tend to be more cautious in reducing interest rates – prevailed in this Copom, the market knows that many members of this group are leaving.
“The market is already looking ahead, seeing a risk ahead and putting this into the price. There is a prospect that the balance within the Copom will move in the direction of a more expansionist collegiate, more pro-economic growth to the detriment of greater control of inflation and macro stability.”
At the end of 2024, Lula is expected to appoint a new president and two more directors to the BC, as the terms of Roberto Campos Neto and directors Carolina Barros and Otávio Damaso approach their end.
The São Paulo stock exchange fell more than 1% after opening this Thursday, with a series of corporate balance sheets occupying the spotlight, while investors reflected on the slowdown in the pace of fall in the Selic rate the day before, in a divided decision by the directors of the Central Bank. .
Around 12 pm (Brasília time), the Ibovespa fell 1.40%, to 127,674 points. In New York, US stock indexes were little changed at the opening on Thursday, as a series of weak earnings offset the impact of data showing that weekly jobless claims rose more than expected. indicating softer conditions in the labor market.
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