After closing Monday at the lowest price in nine months, at R$4.94, the dollar extends its downward movement this Tuesday, at around R$4.90.
Two main factors support this scenario, according to analysts interviewed by CNN. The first is the fact that Brazil has one of the highest real interest rates in the world, second only to Russia. The Selic rate at the highest level since 2017 attracts foreign investors, who bring money to Brazil in search of higher yields.
The second factor is related to the appreciation of the international price of raw materials such as oil and iron ore. The Brazilian market is seen as a large commodity exchange and, therefore, attracts foreign flows.
Vale’s shares currently have a weight of 17.3% on the Ibovespa, the main index of the Brazilian stock exchange, and Petrobras, almost 11%. Together, the two have a weight of 28% on the Ibovespa, or almost a third.
When commodities are high, Vale and Petrobras end up boosting shares. This explains the recent rise in the Brazilian stock market.
With more dollars entering the country, the supply of the American currency grows and its value decreases.
Is it time to buy?
Flávio de Oliveira, head of variable income at Zahl Investimento, says that he would not be surprised if the dollar went to R$4.80, due to the very strong flow of money that is coming from abroad.
Whenever the dollar falls, many people wonder: will it fall further? Is it time to buy?
To CNN, the expert said that he already recommends customers to buy dollars and that he himself has been buying the currency since he hit R$5.
In this scenario, for those who have commitments in dollars, such as a trip abroad, for example, it may be a good idea to try to take advantage of this price.
But be careful! As they say in the financial market, the dollar exists for economists to be more humble. In other words, it is not easy to predict the dollar rate, and this flow that is coming is called speculative, that is, as it can come very quickly, it can leave at the same speed. It’s important to go slow.
*Posted by Ligia Tuon
Source: CNN Brasil
I am Sophia william, author of World Stock Market. I have a degree in journalism from the University of Missouri and I have worked as a reporter for several news websites. I have a passion for writing and informing people about the latest news and events happening in the world. I strive to be accurate and unbiased in my reporting, and I hope to provide readers with valuable information that they can use to make informed decisions.
