Brazil’s Real Climbs as Ibovespa Hits Record Ahead of Copom Guidance

Overview

• The dollar fell 0.70% to R$5.3609, with the real outperforming most major currencies tracked by market data.
• The Ibovespa rose 1.72% to 153,294 points for an eighth straight record close, supported by foreign demand and resilient earnings.
• Official figures showed a US$5.7 billion weekly capital inflow, easing pressure in FX markets and compressing the cupom cambial spread to about 0.7–0.8 percentage point from peaks above 2.2 last year.
• Markets broadly expect Copom to keep the Selic rate at 15% today, with attention centered on the communiqué’s guidance for the path of future cuts.
• Analysts at Commerzbank and BBVA said an unchanged stance is priced and may aid the real, with the risk-on tone also reflecting flows to emerging-market and commodity-linked assets.