HALISTER1: BRL More Focused on Fed Rates, Reforms, Than Impeachment: CA

BRL More Focused on Fed Rates, Reforms, Than Impeachment: CA

(Bloomberg) -- Brazil FX market is focused on U.S. Fed Jackson Hole symposium and local government reforms, Vladimir Caramaschi, chief strategist at Credit Agricole Indosuez, says in a phone interview.
  • “The investor is not prepared for a hawkish stance from Fed,” Caramaschi says
  • “While the approval of the DRU was a good sign, the market remains concerned about Temer’s government ability to approve the reforms”
  • Concern about impeachment final vote is marginal
    • “In Brazil, there is no doubt that Rousseff will not stay in the presidency”
  • NOTE: BRL leads EMFX with 23% gain this year on expectations of reforms after impeachment and as main global central banks keep rates near record low, favoring a yield seeking move
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Vladimir Caramaschi (Credit Agricole Brasil SA DTVM/Brazil)
Michel Temer (Federative Republic of Brazil)

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