Real has 13th best performance among 120 countries in July, according to survey

O real had the 13th best performance of 120 currencies against the dollar in July, according to a survey by the rating agency Austin Rating carried out at the request of the CNN Brasil Business . already the Ibovespa had the 20th best performance among the 79 main stock indices of 78 countries.

According to the survey, the real appreciated 0.96% in the month. In the same period, the main index of the Brazilian stock exchange rose 6.37%, considering the variation in dollar .

The Ibovespa’s performance is classified by Austin Rating’s chief economist, Alex Agostini, as positive, especially considering an adverse scenario in the domestic and international spheres.

“Brazil performed well in the face of the scenario experienced in July, which was quite turbulent in the political environment, which generates great concern for investors”, he says.

According to him, the beginning of the month was marked by a worsening in risk aversion after the disclosure of inflation data in the United States, which reinforced bets on a more aggressive interest rate hike cycle by the Federal Reserve , with a consequent recession. In this scenario, markets considered risky, such as the Brazilian one, lose investments.

“It could have been even worse, considering the context, and it exceeded expectations. We could have ended the month below 100,000 points”, he points out.

Toward the end of the month, data on the economy of United States indicated an earlier-than-expected slowdown, with bets migrating to a milder cycle, reinforced by a the Fed’s openness to the possibility . The change in mood made room for a gain both on the stock exchange and the real against the dollar, albeit small.

“In relation to the dollar, Brazil resisted well. We had an appreciation in July, helped by the larger base after the strong devaluation in June”, evaluates Agostini.

According to him, the Brazilian currency should still have an adjustment period, but it is difficult to establish a trend. “Starting the electoral campaign process, we can see this exchange rate move more in relation to what it is now, and on the side of devaluation. There is a very large fiscal legacy for 2023, and most of the candidates’ proposals go in the direction of keeping the fiscal very fragile”, he warns.

During the month of July, the five best performers were the currencies of Belarus (35.40%), Georgia (6.28%), Papua New Guinea (2.99%), Israel (2.66%) and Costa Rich (2.6%).

The worst performances were registered in countries with political crises, such as South Sudan (20.08% drop) and Pakistan (-14.86%), and in Russia (-12.38%) and Ukraine (-19.98%), involved in a war .

With a worsening of the economic and political crisis, the Argentinian peso accumulated a devaluation of 4.58%, ranking 113th. The euro, on the other hand, ranked 98th, with a fall of 2.55%, in the same month in which it reached parity with the dollar for the first time in 20 years.

Among the stock exchange indexes, the best performances were registered in Argentina (32.14%), Kenya (12.37%), Uganda (10.26%) and Oman (10.22%).

the index Nasdaq on the tech-oriented US stock exchange, ranked third, up 12.35% thanks to bets on a less aggressive Fed.

The worst performers were the stock exchanges of Ukraine (-20.06%), Pakistan (17.15%), Russia (-16.17%) and the stock exchanges of China (-7.64%) and Hong Kong (-7 .38%), affected by fears about the health of the country’s economy.

Also according to the Austin Rating survey, the real accumulates a high of 7.56% in 2022, the eighth largest. The Ibovespa has an accumulated appreciation measured in dollars of 5.99%, occupying the 12th place.