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Dollar Loses Strength After US Inflation Spreads

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Consumer price index of the United States increased 0.3 percent between September and October, less than expected

On this holiday eve in Brazil, the dollar is down, showing that the investor has given a truce in the defensive movement of the last days. The US currency was 1.17 percent lower at 12h, traded at R $3.78. One explanation, analysts say, was the impact of US consumer inflation, the CPI, which rose slightly less than expected in October.

The US consumer price index rose by 0.3 percent between September and October. In the annual comparison, the CPI rose 2.5 percent in October and the core index was up 2.1 percent. The data, released by the Department of Labor, points out that, at least for the hour, there is no need to increase interest rates in the United States. As a result, investors reduce appetite for dollars in the international market, causing the US currency at this moment to be falling against its emerging peers.

Already the Bovespa rose in the late morning of Wednesday, 14, helped by the improvement abroad and supported by the strengthening of shares of Petrobras, which were volatile and near noon, rose by more than 1 percent. Still, on the stock exchange, the bullish move is limited by the retreat of more than 2 percent of Vale’s shares and also a drop in steel stocks.

At 11:50 am, the Ibovespa rose 0.63 percent, at the high of the day, to 85,445 points.

On the local radar are the president-elect, Jair Bolsonaro, and news related to the transition of government. Onyx Lorenzoni said on Wednesday that the name of Deputy Luiz Mandetta has Bolsonaro’s “preference” to take over the Ministry of Health, but that the hammer on the theme should be beaten only next week.

Mandetta responds to an open inquiry when she was Secretary of Health of Campo Grande. He is accused of paying for unpunished medical services. The parliamentarian denies irregularities in the case.

Brazil’s future vice president, General Hamilton Mourao, said the privatization of BR Distribuidora is a possibility being studied by the new government. “I did not say that the government should (privatize BR Distribuidora), but that the government can,” he stressed.