August 19, 2022
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Will Brazil be affected by the fall?

Things have turned. For the first time in two decades, the euro is worth less than the dollar. Expectations are that Currency continued decline. This week, 1 euro was priced at $1.01, which surprised a lot of people. But what does this change mean for the Brazilian market? Look at the consequences of a fall.

Read more: For the first time in 20 years, the euro reaches parity with the dollar

The euro fell by 11% against the dollar in 2022. The scenario benefits exporters Brazilians. However, the simple fall of the euro, especially in a separate analysis, does not have significant implications for Brazil.

The value of the euro is less than the dollar

The scenario is unusual for the following reason: since the euro began to circulate in Europe, on January 1, 2002, this was the first time that the European currency was below the dollar.

Until then, the quote was more than the US currency by between 10% and 30%. The scenario is considered beneficial for Brazilian exports, and for this reason, it has some impact on the business of companies in various fields.

Mainly in the oil, soybean and wheat sectors, but there are many other sectors. The Pricing dollars in the international market, and therefore the current scenario will result in further gains in sales of products from Brazil abroad. Thus, the mere fact that the euro is falling does not have a direct impact on the country.

Because? Well, the first parity of the Brazilian currency is the dollar. Next, there is the relationship between the dollar and the euro. In addition, the Brazilian market has more relations with the United States, for example, than with Europe.

The reason why the euro is worth less than the dollar is Recession economic. The war in Ukraine caused a growing increase in the prices For all services and products. As a result of all this precarious situation, investors have been selling Euro assets to avoid risk.