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Brazilian economic recovery in second semester could be threatened by many – Economics

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Reopening Major World Economies After Worst Of Pandemic COVID-19 left behind, it was supposed to be the main topic of the markets in the second half of 2021, but the political risk and water crisis in Brazil and signaling the cancellation of monetary stimulus by The federal reserve us USA they should divert the attention of domestic investors and jeopardize growing optimism.

In the USA and EuropeProgress in vaccination against covid has led to a sharp decline in the number of new cases and deaths, which has allowed the rules of social distancing to be almost completely relaxed. In the US, indicators of economic activity were already anticipating a stronger recovery from the first quarter.

In recent weeks, the market has also begun to revise its forecasts for eurozone GDP growth this year upward, as several countries in the bloc have begun to reopen their economies, in particular the services sector, including tourism, which has been hardest hit by the pandemic.

In Brazil, immunization is finally gaining momentum. The seven-day rolling average of the first dose of vaccine against covid reached 1,426,813 on Monday. Seven days ago this figure was 1,242,303 people, and 30 days ago – only 47,297 people.

Growth projections START Brazil is improving within ten weeks by 2021, according to the latest Focus survey and is now pointing to 5.05% growth. Four weeks ago, analysts were forecasting 3.96% growth.

The big leap came after the disclosure. BigsGDP for the first quarter of this year, which grew by 1.2%, easily surpassed the market forecast for growth of 0.7%. The second wave of the pandemic had less than expected impact on economic activity.

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On the outside, the biggest threat to the performance of developing countries, including Brazil, in the second half of the year comes from the likelihood that the Fed expects the removal of monetary stimulus, the so-called “cut”. This could, for example, reduce resource flows to developing countries.

At your last meeting money-credit policyMost Fed officials are currently projecting the first US base rate hike in 2023. Previously, most expected the base rate to remain unchanged until at least 2024.

This sharper signal from the Fed was in part a reaction to the sharp acceleration inflation American. In May, the annual consumer price index in the US reached 5.0%, the largest increase since August 2008. The concern is whether this surge in inflation will be temporary or not.

According to Fabrizio Tachetto, investment director and founder of ACE Capital, the peak of inflation in the US is already behind us, and at the same time, the Fed will not be so aggressive in removing monetary stimuli. “With more weighted inflation figures, the Fed will have more time and start a ‘gradual decline’ process early next year,” Tachetto said. “This will create undue optimism in all markets and, in particular, in emerging markets.”

Discharge inflation, in fact, it will be an important topic for the market as well as for central bank Brazil, especially after the water crisis, has forced to activate thermal power plants, which have higher energy production costs.

The Tier 2 red flag, the most expensive in the system, will also go into effect in July, for the second consecutive month, and with a higher rate adjustment. As a result, many analysts began to include a greater contribution of the energy sector to the July inflation. For 2021, the inflation forecast is already at the level of 5.97%.

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But the water crisis is not the only factor that could limit optimism about the Brazilian economic recovery in the second half of the year: the implications CPI to Covid not Senategiven the accusations directly against the president Jair Bolsonaro The purchase of the Indian vaccine Covaxin promises to further exacerbate the political turmoil ahead of the 2022 presidential election. Optimism is currently prevailing with the emergence of new vaccines and the prospect of economic recovery in the second half of the year. But there are many things that could threaten this scenario.

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The dollar continues to reflect the political scenario

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The dollar continues to reflect the political scenario

Yesterday, financial agents evaluated the opposite decision of the Federal Supreme Court (STF) regarding the so-called secret budget. In addition, a decision was made by STF Minister Gilmar Méndez to issue an injunction that would exclude the Bolsa Família from the spending cap rule, with investors trying to understand how this measure would affect the processing of the transitional PEC in the Chamber of Deputies. Oh this PEC!!!!

Since he is an exchange investor, any reading that the budget will be exceeded or become more flexible will negatively affect the exchange market, whether through the PEC or in any other way. We will continue with volatility today.

Looking beyond, the US Central Bank (Fed), although slowing down the pace of monetary tightening at its December meeting, issued a tougher-than-expected statement warning that its fight against inflation was not yet over, raising fears that rising US interest rates will push the world’s largest economy into recession.

The currency market continues to react to political news. The voting on the PEC is saved for today. It is expected that it will indeed be reviewed to open the way tomorrow for discussions on the 2023 budget.

Yesterday, the spot price closed the selling day at R$5.3103.

For today on the calendar we will have an index of consumer confidence in the eurozone. Good luck and good luck in business!!

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Andrés Sánchez consults with the Ministry of Sports, but refuses a political post.

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The former president of the Corinthians dreams of working for the CBF as a national team coordinator. He was consulted shortly after Lula’s election.

Former Corinthians president Andrés Sánchez was advised to take a position in the Ministry of Sports under the administration of Lula (PT). However, he ruled out a return to politics. dreams of taking over the coordination of CBF selectionHow do you know PURPOSE.

No formal invitation was made to the former Corinthian representative, only a consultation on a portfolio opportunity with the new federal government, which will be sworn in on January 1, 2023.

Andrés was the Federal MP for São Paulo from 2015 to 2019. At that time he was elected by the Workers’ Party. However, the football manager begs to stay in the sport, ruling out the possibility of getting involved in politics again.

Andrés Sanchez’s desire is to fill the position of CBF tackle coordinator, which should become vacant after the 2022 World Cup. Juninho Paulista fulfills this function in Brazil’s top football institution.

The former president of Corinthians was in Qatar to follow the World Cup along with other figures in Brazilian football. During his time in the country, he strengthened his ties with the top leadership of the CBF.

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The EU has reached a political agreement on limiting gas prices – 19.12.2022

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Germany sentenced Russian to life imprisonment for political murder by order of Moscow - 12/15/2021
BRUSSELS, DECEMBER 19 (ANSA). European Union countries reached a political agreement on Monday (19) to impose a natural gas price ceiling of 180 euros per megawatt hour (MWh). The main sources of income for Russia and the minimization of the use of energy as a weapon by the regime of Vladimir Putin.

The agreement was approved by a supermajority at a ministerial meeting of member states in Brussels, Belgium, after months of discussions about the best way to contain the rise in natural gas prices in the bloc caused by Russia’s invasion of Ukraine. .

The value set by the countries is well below the proposal made by the European Commission, the EU’s executive body, in November: 275 EUR/MWh. However, the countries leading the cap campaign were in favor of an even lower limit, around 100 EUR/MWh.

Germany, always wary of price controls, voted in favor of 180 euros, while Austria and the Netherlands, also skeptical of the cap, abstained. Hungary, the most pro-Russian country in the EU, voted against.

The instrument will enter into force on 15 February, but only if natural gas prices on the Amsterdam Stock Exchange exceed 180 euros/MWh for three consecutive days. In addition, the difference compared to a number of global benchmarks should be more than 35 euros.

Italy, the EU’s biggest supporter of the ceiling, has claimed responsibility for the measure. “This is a victory for Italy, which believed and worked for us to reach this agreement,” Environment and Energy Minister Gilberto Picetto tweeted.

“This is a victory for Italian and European citizens who demand energy security,” he added.

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Currently, the gas price in Amsterdam is around 110 EUR/MWh, which is already a reflection of the agreement in Brussels – in August the figure even broke the barrier of 340 EUR/MWh.

However, Russia has already threatened to stop exports to countries that adhere to the ceiling. (ANSA).

See more news, photos and videos at www.ansabrasil.com.br.

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