National assets had a day of recovery just hours before the Central Bank of Brazil defined the new level of the national basic interest rate. The Copom releases the new Selic at 6:30 pm, with the market taking for granted a 0.5 percentage point cut, which would take the rate from the current 12.75% per year to 12.25% per year.
The question arises over the board’s treatment of the fiscal situation, after Lula indicated the abandonment of the zero primary deficit target for next year. In the last statement, the Committee argued that “tTaking into account the importance of implementing the fiscal targets already established for anchoring inflation expectations and, consequently, for the conduct of monetary policy, the Committee reinforces the importance of firmly pursuing these targets“. Now, the expectation is whether or not the change in perspective in the Planalto will affect the BC’s predictions and momentum for the Selic.
In today’s session, FED President Jerome Powell’s cautious tone that the cycle of rising American interest rates may have ended helped national assets. The United States monetary authority understands that financial conditions have tightened significantly, although it is still not possible to be certain whether or not there will be a need for a further increase in interest rates there.
For investors, the message seems to have been absorbed with optimism. Future interest rates fell by up to 20 basis points and the dollar returned to trading below R$5, down almost 2% from the day’s lows to end the session at R$4.95.
On the stock exchange, the Ibovespa opened the month of November with an increase of 1.69%, following the Wall Street exchanges. In points, Vale, B3 and Eletrobras led the positive side of the session, which had 74 of the 86 companies that make up the index rising on the day. On the negative side, Raia Drogasil led the losses in points and price variation (-3.76%) after publishing results that did not seem to please.