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A GlobalSource Partners Brazil economics report says the post-election and vaccine-driven rally in risk assets has lifted Brazilian stocks, but the gains are seen as temporary. It cites a worsening fiscal situation, a second COVID-19 wave in Brazil's South and Southeast, and no major reform bills close to approval.
A weaker real and fiscal stress tend to raise the cost of imported feed inputs priced in dollars for Brazil, while a firmer real would lower them. The report's view that the rally is temporary points to renewed BRL weakness that would support Brazilian soybean and corn export competitiveness.
globalsourcepartners.comCristina Pinotti, Affonso Pastore, Marcelo Gazzano, Paula Magalhães, Bruno CordeiroNov 23, 2020After 301 past bullish macro events, Brazilian Real (BRL per USD) moved a median +0.4% over 5 sessions (57% higher; middle half -1.2% to +1.7%), and +1.0% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
