Brazil Optimism Persists; Swaps Face Correction: Quantitas
(Bloomberg) -- Many investors still have a positive outlook on the country fed by the belief the government will succeed on the approval of the spending cap bill, Matheus Gallina, FI trader at Quantitas Gestao de Recursos, says in a phone interview.
- Correction seen in long-end DI curve earlier today given absence of inflows that impacted swap rates, BRL and stocks yesterday; BRL drop today tracks broad EM
- “That was an overall bet on Brazil,” Gallina says
- More bullish trend on BZ assets may resume later today as a Lower House commission is expected to vote on the spending cap bill
- Approval of changes in pre-salt rules more aimed to benefit Petrobras stock; “anyway, it is fresh evidence of government strength in Congress”
- DI market bets so far show greater chance of a 25bps cut at coming BCB meeting; investors await Sept. CPI tomorrow and spending cap bill vote in House’s floor next week to fine tune expectations on BCB decision
Alert:
HALISTER1Source: BFW (Bloomberg First Word)
People Matheus Gallina (Quantitas Gestao de Recursos SA)
To de-activate this alert, click
hereUUID: 7947283