Ibovespa hovers around stability and dollar rises with risk aversion by Fed minutes

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O dollar rose 0.58%, quoted at R$ 5.170, around 12:05 pm this Wednesday (17), benefiting from a risk aversion among investors before the release of the minutes of the August meeting of the Federal Reserve .

At the same time, the Ibovespa rose 0.08%, to 113,605 points, hovering around stability. The index is influenced by downward pressures with a negative day abroad with market caution and the positive performance of stocks linked to the oil which accompany the rise of the commodity.

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The market is waiting for possible clues of the next steps of the central bank of the United States in its cycle of high fees .

Indications of a more aggressive move tend to favor the Dollar and harm other currencies and exchanges, while a softer signal would increase appetite for investments more risky.

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The market has been changing its position as to the degree of aggressiveness of the Fed depending on the country’s economic data and speeches that are released, impacting asset prices.

On Tuesday (16), the dollar rose 0.94% to R$5.14. The Ibovespa, on the other hand, advanced 0.43%, to 113,512.38 points, renewing the maximum in four months.

overall feeling

Strong global risk aversion by investors, triggered by fears about a possible widespread economic slowdown due to a series of interest rate hikes around the world to contain record levels of inflation, has eased in recent days, reflecting expectations of a cycle of interest rate hikes. less aggressive in the United States.

The process of raising the US rate continued in July with a new increase of 0.75 percentage point. However, the Federal Reserve has signaled that it may make smaller hikes as the country’s economy already shows signs of slowing, seeking to avoid a recession.

Higher interest rates in the United States attract investments for the country’s fixed income due to its high security and favor the dollar, but harm markets and stock exchanges around the world, including the North American ones.

Investors are also monitoring the situation of China’s economy, which is also showing signs of a slowdown linked to a series of lockdowns in relevant cities. The expectation is that the Chinese government will intensify an effort to stimulate the economy, but with difficulties to reverse a situation of low consumption by the population, which impacts the country’s demand for commodities.

In the domestic scenario, the Benefits PEC which creates or expands social benefits with an estimated cost of R$ 41 billion, was poorly received by the market, as it reinforces the fiscal risk by bringing new spending above the ceiling.

The Ibovespa and the real were harmed by the scenario, but an apparent greater optimism in the market has allowed a recovery.

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*With information from Reuters

Source: CNN Brasil

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