Dollar reaches R$ 4.69 with favorable flow; Ibovespa rises more than 1%

O dollar fell 1.19%, quoted at BRL 4.704, around 1:35 pm this Friday (1st), after reaching BRL 4.690 at the session low while the market digests the Payroll report for non-farm employment U.S. Job creation was lower than expected, but the unemployment rate was at the lowest level in two years and wages continue to rise.

The real is maintaining an investment flow based on Brazil’s high interest rates, assets discounted on the stock exchange and the search for markets linked to commoditieswhose prices soared with the pandemic and the war in ukraine.

At the same time, the Ibovespa rose 0.96%, quoted at 121,156 points, also reflecting the North American data. The data strengthened bets on a 0.5 percentage point hike in interest rates by the Federal Reserve in May, but also reduced fears of a possible recession in the country. An increase of this magnitude was already expected by the market, with little effect on current investment flows.

At the same time, the market remains alert to a new round of negotiations between Ukraine and Russia. The Russian government said it saw progress in the talks, which reduces investors’ risk aversion and benefits the real and the Ibovespa.

In Brazil, investors monitor the beginning of the Central Bank civil servants strike and the possible impact of the movement, in particular the possibility of a 5% readjustment for public servantswhich would represent more spending by the government and raise fears of a fiscal lack of control, a scenario that would favor the dollar.

On Thursday (31), the dollar fell 0.47%, ending at R$ 4.762, the lowest value since March 2020. In the quarter, the fall was 14.55%, the highest since 2009. Ibovespa retreated 0.22%, to 119,999.23 points, while, in the quarter, the increase was 14.5%, the highest since 2020.

Petroleum

Since the invasion of Ukraine by Russia on the 24th of February, the markets for Petroleum show the highest volatility in two years, with commodity prices reaching levels last seen in 2008.

The commodity has fluctuated in the range of US$ 100 and US$ 110 in recent days. On the one hand, the market expects lower demand due to new lockdowns in china and the prospect of a Longer interest rate hike in the United Stateswhich would slow down the country’s economy.

At the same time, any news about the war influences prices, feeding or reducing fears of supply problems and affecting prices.

However, compared to previous years, oil remains at high values ​​and rose more than 30% in the first quarter, due to the mismatch between supply and demand for the commodity, with the main producers, gathered in the OPEC+, not yet resuming pre-pandemic production levels. The picture was intensified with the tensions in europe.

commodities

The surge in commodities with the conflict in Eastern Europe favors the Brazilian market, and its effects have helped to overcome risk aversion with the war in Ukraine, which has benefited the real so far.

The cycle is linked, in part, to the rise in oil and iron ore due to high demand amid the economic recovery. O interest rate hike in the US also feeds this migration, with the exit of the North American variable income.

Another factor behind this movement is expectations of more pro-growth measures in the China that are raising hopes of a recovery in demand for metals, which has led to higher prices, reinforced by the crisis in Ukraine.

However, Chinese government interventions in the market and a new outbreak of Covid-19 in the country with lockdowns, they still generate downward pressures, in an up and down in the price, which remains at high levels.

War in Ukraine

Follow CNN’s live coverage of the conflict.

With the war in Ukraine completing a month, Ukrainian forces have been trying to reclaim territory from the Russians in recent daysaccording to a senior US defense official—who described them as “able and willing” to do so.

Russia and Ukraine hold a new round of talks on Friday. The Ukrainian president signaled that the country would accept a neutrality statusa Russian demand, but without territorial concessions, and Russia talks of progress in the talks.

Although Russia has promised toreduce attacks in Ukraine, bombings have resumed in Chernihiv, in the north, as stated by the local mayor Vladyslav Atroshenko.

From an economic point of view, the sanctions with the greatest economic impact on Russia are linked to the expulsion of Russian banks from Swifta global means of payment processing.

*With information from Reuters