The dollar retreated against the real this Thursday, taking a breather after a rally that took it to a new peak since late January the day before, in line with signs of one-off easing in the strength of the US currency in international markets.
At 10:09 am Brasília time, the spot dollar dropped 0.54%, at R$5.3940 reais on sale. The respite comes after having risen for the fifth session in a row on Wednesday, at R$5.4231 reais, the highest value for a session closing since January 27.
On B3, at 10:09 am Brasília time, the first-maturity dollar futures contract was down 0.62% to R$5.4290 reais.
Analysts from Bradesco's economic research and studies department said in a report that global financial markets are “reversing part of the fear of recession that prevailed during the week”.
The dollar index against strong rivals, which has hit a new high since late 2002, was hovering close to stability this morning as European bourses and Wall Street futures traded in the black.
There were also signs in the market of cooling demand for US sovereign bonds, whose yields advanced on the day.
US debt returns had plummeted in recent days amid an international flight to safety amid fears that a tight monetary tightening by the Federal Reserve would send the economy into recession.
A sign of relief in global sentiment on Thursday, several currencies of emerging or commodity-sensitive countries, such as Mexican, Chilean and Colombian pesos, South African rand and Australian dollar, showed gains in this session, following the recovery in prices of products such as the oil, which had tumbled earlier in the week.
“Global recession fears are weighing on commodity prices, which has weakened the Brazilian real. But the underlying picture is positive and our fair value remains at USD 4.50,” Robin Brooks, chief economist at the Institute of International Finance (IIF) said in a Twitter post.
The fair value of a currency refers to a quotation that would most closely correspond to the economic fundamentals of its country, without the influence of market distortions.
As justification for this scenario, Brooks cited a global structural shift towards higher commodity prices, despite their recent one-off decline, and Brazil's relative political stability when compared to some emerging peers of authoritarian political regimes. “Any democracy is better than an autocracy,” he said.
After falling almost 15% against the real in the period from January to March, the dollar had a significant recovery in the second quarter and now needs to appreciate only 3.2% to fully return the losses accumulated in 2022.
Sources: investing.com
