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Analysis from Stratfor argues that the strengthening US dollar is driving capital flight from emerging markets, with Argentina's peso and Brazil's real among the worst performers. Argentina faces limited capacity to handle the currency pressure, while Brazil's trade surplus and low inflation provide some buffer.
A stronger dollar and weaker Brazilian real make Brazilian soybean and corn exports cheaper for buyers, which tends to pressure global feed grain and soymeal prices.
library.stratfor.comJun 28, 2018After 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.
After 117 past bearish macro events, Soybean Meal moved a median -0.6% over 5 sessions (41% higher; middle half -2.5% to +1.7%), and +0.5% 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.
