December 3, 2023
The dollar remains at 5,144 Brazilian riyals amid announcements of the Lula transitional team

The dollar remains at 5,144 Brazilian riyals amid announcements of the Lula transitional team

after a strong day, trade dollar It decreased by 0.56% and ended Tuesday (8) at R$5,144, Amidst announcements about the transfer team (see list below) And doubts in the market about the composition of the future economic management of the government of Luis Inacio Lula da Silva (PT).

Already Ibovespamain index of stock trading Brazilian (b 3), which includes the most heavily traded companies, ended the session with a slight increase of 0.71%, at 116.160.35 points. The trading volume on the Brazilian Stock Exchange amounted to 29,574,495,048 Brazilian Reals.

The U.S. currency movement is occurring after Labor Party leader, Federal Rep. Gliese Hoffman, formalized a call for MDB – the most centralized party – to be part of the transition to Lula’s government, forming the political council and appointing technicians.

However, concerns remain about the lack of clear indications about who will be Lula’s finance minister and concerns about how to implement Labor’s financial agenda, which is keeping volatility in the exchange market high, said Larissa Brito, Planor’s financial strategist.

Markets have held out for weeks that Lula will nominate a moderate name for the job, such as Henrique Meirelles, but the former central bank chief has said several times that he has not received invitations to join the elected government. At the same time, fears are growing that the Finance Ministry will end up led by someone more left-wing who may be inclined to be more flexible in the country’s fiscal rules, such as former Sao Paulo mayor Fernando Haddad.

“The market has already indicated that it will not accept meaningless names for continuity [gestão da] The Brazilian economy,” Brito said, referring to the dollar’s ​​2.39% rise the previous day, to 5.1733 Brazilian reals for sale, the highest daily increase since October 24 (+2.94%) and the highest closing level since October 28 (5.3023).

The next government’s transition team is considering working towards a constitutional amendment to ensure an exception to the spending cap and to adapt next year’s budget to Lula campaign promises, such as keeping R$600 from Brazil Aid And the real adjustment to the minimum wage. The amounts considered exceptional have not yet been officially determined, but are expected to exceed R$200 billion.

“All of these assumptions, amid lower clusters in 2023, given lower and lower economic growth inflationcan increase the perception that the government will not have sources of financing other than financing through public bonds, because such challenges also make it difficult to introduce new taxes,” said Jason Vieira, chief economist at Infiniti OriginOn a note to clients.

Dollar value published daily by newspapers including UOLrefers to the trade dollar (Learn more by clicking here). For those who travel and need to buy coins from exchange brokers, the value is much higher.

transitional economic team

The President-elect’s Economics Team Luiz Inacio Lula da Silva (PT) For the transitional government has a historic PT and a toucan.

Four economists will coordinate the working group: PT members Nelson Barbosa, Guilherme Mello, Toucan Andre Lara Resende and Percio Arida.

The names were announced by Vice President-elect, former toucan Geraldo Alcumen (PSB), this Tuesday (8).

*With information from Reuters and the newsroom UOL, in Brasilia