HALISTER1: Brazil FX, Swaps Markets Eye Inflation, House Vote: Gradual

Brazil FX, Swaps Markets Eye Inflation, House Vote: Gradual

(Bloomberg) -- BRL, DI markets are watching inflation dynamics and political scenario along with global rates outlook as Brazil’s government is unlikely to achieve the fiscal adjustment, Andre Perfeito, Chief Economist at investment firm Gradual, says in a phone interview.
  • Inflation IGP-M released earlier today surpassed estimates; investors also concerned potential vote against former House speaker Cunha tonight could negatively impact president Temer’s administration
  • Main factor behind USD strengthening abroad is expectations surrounding U.S. rate hike; “in a certain moment, the markets will need to accept the idea of a hike”
  • NOTE: BRL -0.63% at 3.2947/USD; DI Jan 21 rate +4bps
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Andre Perfeito (Gradual Corretora de Titulos e Valores Mobiliarios Ltda)
Michel Temer (Federative Republic of Brazil)

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