In another day of tensions between President Luiz Inácio Lula da Silva and the Central Bank (BC), the dollar surpassed the barrier of R$ 5.20 for the first time in two weeks. The stock market retreated, against the optimism in the North American market.
The commercial dollar ended this Tuesday (7) sold at BRL 5.20, up by BRL 0.026 (+0.5%). The price started the day low, falling to R$ 5.13 around 10 am. It reversed its movement during the morning, retreated to R$ 5.15 around 3 pm and rose again at the end of negotiations. The US currency is at its highest level since January 23, when it also closed at R$5.20. Despite today’s high, the currency accumulates a drop of 1.52% in 2023.
In the stock market, the day was also marked by volatility. The Ibovespa index closed at 107,830 points, down 0.82%. The indicator started the day close to stability, but accelerated the losses after Lula’s statements about the Central Bank.
At breakfast with journalists from independent and alternative vehicles, Lula again criticized the Central Bank. The president said that basic interest rates, at 13.75% a year, are high and that they need to fall to generate more growth and create jobs, according to Portal Brasil 247, one of the vehicles present at the breakfast. Afterwards, Lula said he was in favor of fiscal responsibility, but declared that the Central Bank needs to have an inflation target and a growth target.
The statement put pressure on the dollar and the stock market in Brazil. The US currency rose here, while falling against major global currencies. The same occurred with the stock market, which took off from the North American stock exchanges, which had a strong increase after the president of the Federal Reserve (Fed, North American Central Bank), Jerome Powell, affirmed that the pressures on the North American inflation America are falling, even as the country creates more jobs than expected.
Powell’s speech was interpreted as a sign that the Fed should not change the pace of interest rate hikes. Last week, the US Central Bank raised basic interest rates by 0.25 percentage points, after four consecutive highs of 0.5 points.
* With information from Reuters
