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   Non-TechThe Brazil Board


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To: kidl who wrote (2120)5/4/2021 11:30:07 AM
From: elmatador
   of 2171
 
COVID peak looks behind
USD are flooding: Prices from Iron Ore, Coffee, Oil to Soft Commodities are booming
Companies including $VALE $PBR $SID $USNZY are making tons of money. EV at the low end
In a world where liquidity floods is time to buy while its cheap

Brazil, Slowly Drags Itself Through Pandemic Nightmare As Market Gets Bullish

Kenneth Rapoza
Senior Contributor

Markets
I write about global business and investing in emerging markets.

KMR IMAGESRemember Brazil’s P1 Covid-19 variant that sent the country back into lockdown? Things are calming down now. Brazil is a “buy at the sound of cannons”. In fact, you may even be a few weeks late.

As investor Fernando Pertini says in his above Tweet last week, which he pointed out to me in a private conversation, the commodity bull is always good for Brazil.

“I am long EWZ and see it as well-positioned at the intersection of the inevitable end of Covid and a bout of reflationary dollar weakness as a result of a Liberal spend-a-Rama Fed,” says Brian McCarthy, head of Macrolens, an investment research firm in Stamford, Connecticut.

Spenda-a-Rama means rich bulge bracket banks like Goldman Sachs GS -1.9%, and high net worth individuals in the States with money all over the place will have more gains from their securities and will look elsewhere in the world. They’ll rediscover Brazil.

The iShares MSCI Brazil EWZ -1.2% exchange traded fund approached another 2021 bottom in early March. That was the perfect time to buy. Right now, it’s trading above its 50- and 200-day moving averages. Momentum is still strong. It’s not overbought.


EWZ. Laggard YTD.

YAHOO! FINANCEI like this chart because I have been selling all my old Petrobras positions (of which I have many still) and buying them back in a wash sale at $8 and change. This is a $5 to $12 stock. That’s the range this thing travels in. I now have enough Petrobras to sink a battleship.

Brazil’s Bovespa Index has not yet reached its January-level high of 125,077 points. To see how investors see the future, open interest in the options market is as good a crystal ball as any the market has to offer.

Open Interest is data published daily by the stock exchanges about the number of open contracts due on a certain date. In the case of options, these are called the "expiration dates.”

How are “the sharks” in Sao Paulo positioned for Brazil as it slow-walks out of its pandemic nightmare?

“There are a lot more calls than puts in each strike above the strike of 119.000 points on the Bovespa Index,” says options specialist Daniel Coelho Barbosa of Vandermart Solutions. Calls are options that give you the right to buy a security at a certain price and puts give you the right to sell a security at a certain price. In this particular case, it’s options of the Bovespa Index.

“We see that there are many big players (Bovespa options are expensive) that have huge amounts of calls sold naked,” says Barbosa. “Naked" is when you believe the option price will never be met. “It's free money if the Bovespa never gets there because the calls will soon expire in May,” he says, meaning investors there believe they are buying on a discount and that’s good for long investors who believe the Brazilian stock market will pull even farther ahead in June.

In fact, looking at the same data for June, call options above the 120,000 point break are the most popular.

You can see option interest for the Bovespa Index here.

According to EPFR Global, in the week ending April 30, Brazil equity funds extended their longest outflow streak since the height of the pandemic’s first wave last March. The region’s largest economy is wrestling with the pandemic, which has killed nearly 400,000 people, an inflation rate at a six-year high and a weak president.

As far as the “Brazilian Fed” goes, their central bank says it will pursue only a “partial” adjustment in monetary stimulus in the coming months, with the focus on rising inflation.

The market expects interest rates to remain at stimulatory levels until year end. And then next year will see higher rates. Still, if Brazil is climbing out of the pandemic by then, and if the commodity cycle is still strong, there is nothing but wind at Brazil’s back.

Bolsonaro in the Gutter, But No ‘Pink Wave’

Jair Bolsonaro, the so-called Tropical Trump, is in worse shape than Trump ever was. His approval rating started the month of April in the 30s. Some 60% disapprove, according to pollsters Poder360.

This month just started, but last month started off like this for Bolsonaro, as TS Lombard analyst Elizabeth Johnson highlights:

Resignation of the commanders of all three branches of the armed forces highlights tepid support for Bolsonaro among members of the military, his base;A cabinet reshuffle put the spotlight on Bolsonaro’s political weakness, so he has had to cede more power to the Congress, which are centrists by the way

He is up for re-election next year. Ex-con and ex-president Luiz Inacio Lula da Silva is — potentially — breathing down his neck. Could he run and win? Personally, I think Brazil is over Lula and the fact that he has had to go on a world tour to sell himself to the liberal media in Europe on how fit he is tells me that he is desperate for press, and desperate for relevance. If he is not getting it in spades in his own domestic press, then he knows he can get it from the British and the French media who still think it’s 2002 in Brazil. My guess is that his European press tour is really about Lula putting feelers out for fund raising in 2022 for “progressive billionaires” to fund the Workers’ Party.

This is not to say that Bolsonaro has struggled through the pandemic. Like Trump, he caught Covid-19 and survived it. And like Trump, he also distrusts his national press, which has been using a “death by a thousand cuts” strategy on Bolsonaro since he got elected. After rifling through three pro-Wuhan style lockdown Health Ministers, Bolsonaro — suffice to say — did not trust what he was hearing or reading about the pandemic and was soft in his fight against it.

“In a country where the informal economy is colossal, where there are more than 70 million workers living in precarious situations and without proper social protection, anger has risen against Bolsonaro’s downplaying of Covid,” says French journalist and editor-in-chief at aleurs Actuelles, Virginie Jacoberger-Lavoue. She recently wrote a book about Bolsonaro, loosely translated into English to mean Brazil and Bolsonaro’s Wild Ride, published by Rocher.

“Bolsonaro knows what awaits him in 2022. He will have to confront the dead of Covid-19 to convince people to vote for him,” she says. “He will have a hard time escaping from that.”

The unknown is where people will be a year from now, or even six months from now. There is just no way that the majority of Brazilians are fine with lockdowns and restrictions after millions of them have already contracted the virus and survived it.

Moreover, Brazil has probably moved on from Lula, Bolsonaro’s most visible threat, but surely not the only one.

I don’t see anyone from the far left of Lula’s Workers’ Party coming forward as a new voice to lead a “pink wave” in Brazil (and Latin America). Nor do I see anyone from the marginal PSOL party, a favorite of the globe trotting left-wing media and arts influencers in Brazil.

It’s too early to game that out and I am definitely not watching Brazil’s politics closely anymore. Right now, the market is looking for Covid to pass, not Bolsonaro.

If Brazil comes out of the pandemic once and for all at any point this year, then lockdowns and other restrictions end and Brazil surely does better than any other nation in Latin America except for maybe Mexico. EWZ will surely catch up to the iShares MSCI Mexico fund, no doubt about it.


Brazil has been vastly underperforming Mexico for the last three months. Only in the last four weeks ... [+]

YAHOO! FINANCEOver the weekend, Bolsonaro fans took to the streets of Rio de Janeiro, Sao Paulo, and Brasilia. The media complained that no one was in masks, but that goes without saying.

I also suspect the U.S. will also send extra Pfizer and Moderna vaccines to Brazil at some point in the near future, probably during our early summer months. Whether or not Brazilians take them is another story, but any headline of the sort would drive markets higher.

As a Brazil investor, I cannot tell from here if Bolsonaro’s weekend crowds were bigger, smaller or the same as they were when he swept into power. Bolsonaro will need sustained numbers like that next year. More important than Bolsonaro, Brazil will need to move on from Covid-19 sooner rather than later. It does not have the resources to keep its economy in second gear for long.

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To: Glenn Petersen who wrote (2090)5/19/2021 2:03:28 AM
From: elmatador
1 Recommendation   of 2171
 
Rest of the world down.
Brazil Up.
tradingview.com
Dollar down
tradingview.com

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To: elmatador who wrote (2151)5/23/2021 7:14:27 AM
From: Glenn Petersen
   of 2171
 
Brazil’s Vaccine Shortage Sets Off Wild, Crime-Fueled Scramble for Jabs

The Daily Beast
May 23, 2021

RIO DE JANEIRO—Deep in the Brazilian Amazon, the Yanomami Indigenous people breathed a sigh of relief when COVID-19 vaccine doses were finally delivered. But then—shortly afterwards—illegal miners occupying the territory reportedly paid off two nurses in gold in exchange for jabs meant for Indigenous people.

Some 3,100 miles away, in a sleepy town in southeastern Brazil, a 48-year-old mayor and his wife were among the first to get vaccinated against COVID-19 early this year—ahead of doctors and even the elderly. And in the state of Paraná, 30 politicians are suspected to have been vaccinated secretly, even though they didn’t qualify for a shot.

Since Brazil began to vaccinate against COVID-19 this year, hundreds of the country’s rich and powerful have been suspected of skipping the vaccination line. Politicians, business moguls and social media influencers have all made headlines after going to great lengths to jump the queue.

“Each case is more bizarre than the last, it’s a total disregard for the rules,” said Dr. Paulo Lotufo, epidemiologist and professor at the University of São Paulo. “And some of them are even outing themselves by bragging on social media about being vaccinated.”

Line-jumping by the rich and powerful has come as Brazil grapples with one of the world’s deadliest COVID outbreaks. The virus has killed 442,000 people in the country, a toll second only to the United States. More than half have died this year alone as the pandemic has spiraled out of control, aided by highly-contagious strains and a failure to impose lockdowns.

Vaccination, meanwhile, has lagged amid a shortage of shots. Brazil—once a global leader in immunization—has been left scrambling for supplies, after far-right president Jair Bolsonaro turned down multiple early offers to buy doses from Pfizer and other manufacturers.

So far, just 9.4 percent of Brazilians have been fully vaccinated, with immunization still focused on priority groups like the elderly and those with existing illnesses.

“We’re working in the context of a shortage,” Lotufo said in an interview with The Daily Beast. “We have the infrastructure for mass vaccination. But the problem is that the Brazilian government missed the opportunity to buy a huge lot of vaccines.”

Brazil has one of the world’s largest universal health-care systems, which operates alongside a vast private sector accessible to those with insurance plans or the means to pay out of pocket. But the government has so far only made the vaccine available through its public network, immunizing health workers, the elderly and those with pre-existing conditions.
“There will be repercussions.” — Fernando Francischini, state deputy, anti-fraud committee.
Still, those with power or money have tried to circumvent these rules and snag an early shot. In northeastern Brazil, a digital influencer got her COVID-19 jab ahead of priority groups when her husband put her name on a staff list at a private health clinic he owns.

And the line-jumping has only showcased the deep inequality that already plagued Brazil, explained Ana Maria Malik, a professor of health policy and management at the think-tank Fundação Getulio Vargas.

“It’s forced people to recognize the inequity in this country,” Malik told The Daily Beast “The way people have been trying to get first in line is absolutely ridiculous and unfair.”

Widespread fraud has sent authorities across Brazil scrambling to enforce the rules and hand out punishment to those cutting the line. Mayors and other public servants who have been caught have been removed from their posts, while business moguls guilty of jumping the queue have been fined thousands.

In Paraná, authorities have been grappling with a particularly intense wave of fraud. Last week, a woman posing as a nurse was imprisoned when authorities caught her selling stolen vaccines over Whatsapp . Nearly 100 fraudsters are also suspected of impersonating people who have already died to snag a vaccine. And, in one city, almost 500 doses of the vaccine were applied to people using the same 165 social security numbers.

The widespread reports of fraud prompted Paraná’s lawmakers to form a committee last month, tasked with investigating and punishing those who cut the vaccination line. Fernando Francischini, a state deputy who is spearheading the commission, says there have been nearly 800 reports of vaccination fraud so far.

“It’s absurd, the amount of abuse we’re seeing,” he told The Daily Beast in an interview. “Oftentimes, it’s young people cutting in line. And they’re taking away the opportunity from those who have comorbidities or are elderly.”

The commission hopes that it can send a firm message by going after those who are getting vaccinated fraudulently and repair the image of the vaccination campaign, Francischini said.

“It shows that there will be punishment and serves as an example of anyone thinking of cutting the line,” he said. “Because they know there will be repercussions.”

But attempts by the rich and powerful to score vaccines have not only remained in the shadows. Corporations and special interest groups—including judges—have been lobbying the federal government for months, asking for permission to buy their own vaccines directly from manufacturers.

Bolsonaro, who has long cast himself as a pro-business leader eager to “privatize everything,” has signaled support for such initiatives. He has said allowing companies to buy vaccines and immunize their employees would lead to savings for the government.

And it seems some of these lobbying efforts have paid off. Last month, Brazil’s Senate moved forward with a bill that would allow corporations to buy vaccines privately, as long as they donate half of the supplies they purchase to Brazil’s public health network.

“We are at war,” said Arthur Lira, the leader of the chamber and a staunch ally of Bolsonaro. “And in war, anything goes to save lives.” Lawmakers will now review the bill, which would allow companies to buy doses even before the government has finished vaccinating priority groups.

Yet critics warn that allowing corporations to buy their own vaccines will only deepen the inequity that already exists in Brazil. They note it would mean a healthy Brazilian working for a large company could end up getting vaccinated before an elderly person with a medical condition who relies on the public health-care network.

“It’s just not fair to be able to get immunized because you happen to work for a rich employer,” Malik said. “It’s a matter of priority. We have populations that are in danger. So it’s unethical to take those doses away from them.”

Allowing the private sector is especially problematic because there already aren’t enough doses for groups that run the greatest risk of dying of COVID-19, Lotufo said. Opening up vaccines to the private sector could create an even more intense scramble for vaccines that could lead to a price spike.

“We don’t have a surplus,” Lotufo said. “If there were enough vaccines, we would be able to vaccinate everyone. We could vaccinate two million people per day. But, for now, these vaccines don’t exist.”

Story Link

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To: Glenn Petersen who wrote (2152)6/3/2021 10:00:33 AM
From: elmatador
   of 2171
 
The article is slanted for an American readership

Brazil exceeds 100 million distributed doses of coronavirus vaccine

Brazil exceeded 100 million doses of vaccine against Covid-19 distributed throughout the country since the launch of its national vaccination plan on January 18

No lack of vaccines
Brazil is the 4th country that vaccinates in the world.
Iwhin this year, all Brazilians who want to be vaccinated (me NOT included) will get the jab.

Brazil now becomes the 5th country in the world to produce vaccines.
Yesterday Brazil signed a technology transfer agreement between Astra Zenica and Fiocruz.

All good.

Now for the angle of the article:

The American journalists are being paid by Brazilians interested in the international campaign financing got to Lula or the so-called Third Way.
Thus these guys are painting the situation with dark colors. They want to do a Trump election outcome in Brazil
Guess what? They will fail because Brazilians vote with their pockets.

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To: Glenn Petersen who wrote (2152)6/3/2021 10:02:19 AM
From: elmatador
   of 2171
 
Brazilian Real Vs USD
Look how it compares with other currencies

And

Brazilian Real Up
BOVESPA Up
tradingview.com
GDP Up


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To: Glenn Petersen who wrote (2152)6/3/2021 10:20:00 AM
From: elmatador
   of 2171
 
BofA, Goldman Boost Brazil Growth Bets After Solid First Quarter

First quarter GDP grows 1.2% q/q, above estimate by economists

Brazilian real jumps to highest level this year after release

By Andrew Rosati

1 de junho de 2021, 13:08 WEST Updated on 1 de junho de 2021, 16:30 WEST

Analysts from Goldman Sachs Group Inc. and Bank of America Corp. see Brazil’s economy growing faster this year after a better-than-expected first quarter that was driven by investment and booming agriculture.

Goldman increased its growth forecast for Latin America’s largest economy to 5.5% from 4.6%, while BofA raised its projections to 5.2% from 3.4% after Tuesday’s data release by the national statistics agency.

“Concerns about the slowdown in first quarter activity were exaggerated,” David Beker, BofA’s Chief Brazil economist, said in an interview. “We expect the economy to recover visibly in coming quarters,” Goldman’s Alberto Ramos wrote in a note.

Brazil’s gross domestic product increased 1.2% in the first quarter from the previous three-month period, more than the 0.9% median estimate from analysts in a Bloomberg survey. From a year prior, the economy grew 1.0%, the statistics agency reported.?



The recovery took place even if challenged by fresh restrictions on commerce and movement meant to help combat new, more contagious variants of the virus. Cash handouts for the most vulnerable Brazilians, the centerpiece of President Jair Bolsonaro’s stimulus package, were also paused during the quarter. Still, recent indicators such as retail and industrial output have topped forecasts.

What Bloomberg Economics SaysThe Brazilian economy showed surprising resilience in the first quarter, maintaining a strong pace despite the hiatus in emergency cash handouts, a first rate hike and the surge in Covid-19 cases. The rise in the investment and savings-to-GDP ratios bode well for growth in both the near and medium-term. The pandemic remains a key factor for the near-term outlook, as does the policy uncertainty -- which will weigh on the currency, interest rates and confidence.

--Adriana Dupita, Latin America Economist

--Click here for full report

Agriculture and investments drove growth, up 5.7% and 4.6%, respectively, during the quarter. Meanwhile, family consumption slipped 0.1%.

Swap rates on the contract due in January 2022, which indicate investor expectations for monetary policy, rose 5 basis points to 5.11% in morning trading. The real strengthened 1.1% to 5.1603 per dollar, the best performance by a major currency on Tuesday.

Benign OutlookPolicy makers and private sector analysts are becoming increasingly confident that growth can surpass 4% this year. Economy Minister Paulo Guedes echoed private estimates, saying Tuesday’s release signaled strong expansion for the rest of the year.

But those hopes are largely pinned on bets immunization campaigns will gain momentum in the second half, even as the government struggles in sourcing shots and inputs. Brazil continues to suffer one of the world’s worst coronavirus outbreaks, registering 860 deaths from the virus on Monday.

The central bank also began increasing its interest rate in March as higher commodity costs and lagged effects from government spending fueled consumer prices. Annual inflation stood at 7.3% in mid-May, above the bank’s 2021 target of 3.75%.

The recovery is likely to continue gaining momentum despite the worsening of the pandemic late in the quarter, with factors including fiscal and monetary support helping growth, according to Andres Abadia, an economist at Pantheon Macroeconomics.

“The outlook in the near term is benign,” he wrote in a research note.

— With assistance by Josue Leonel

(Recasts headline, lead; adds Goldman, BofA forecasts and comment by the Economy Minister)

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To: richardred who wrote (2070)6/8/2021 1:20:17 PM
From: elmatador
   of 2171
 
Warren Buffett’s Berkshire Hathaway makes $500 million investment in Brazilian digital bank

Nubank, which was founded in 2013, made its first appearance on CNBC’s Disruptor 50 list earlier this year. The company said it has roughly 40 million customers.~

ELMAT: Including yours truly..

The company’s CEO told The Wall Street Journal that an initial public offering is likely but is not planned.

Buffett is no stranger to investing in financial firms, as traditional banks and insurance companies make up a large portion of Berkshire’s investment portfolio. However, Buffett had sold nearly all of his stake in Wells Fargo by the end of the first quarter, according to securities filings.

Berkshire’s class B shares were little changed on Tuesday morning following the announcement. The stock has risen nearly 25% year to date.

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To: THE ANT who wrote (2059)6/21/2021 12:05:39 PM
From: elmatador
   of 2171
 
There's only one sliver of green across all EM FX since last week's hawkish Fed surprise: Brazil's Real.

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From: elmatador6/22/2021 6:19:48 AM
   of 2171
 
Brazil Outperforms
The Brazilian real has been the top performer among emerging-market currencies this month, followed by commodity-linked peers such as Russia’s ruble and Colombia’s peso. The forint, zloty and koruna have underperformed.

Brazil’s monetary authority hiked its key interest rate by 75 basis points and opened the door to even bigger increases on Wednesday amid surging inflation forecasts. The nation is among the first to increase its key rate to pre-pandemic levels, taking a more aggressive stance to battle inflationary pressures.


“Brazil is probably the clearest example of a combination of better growth prospects, reduced political noise, more hawkish central bank and undervalued currency to justify its recent outperformance,” the BofA strategists wrote.

Goldman, JPMorgan Pin Emerging-Market Bets on Hawks Beating Fed

By Netty Idayu Ismail

20 de junho de 2021, 12:13 WEST Updated on 21 de junho de 2021, 12:43 WEST

Tightening expectations support developing-nation currencies

Rally on track with U.S. financial conditions loosest ever

Emerging-market currencies hit by a hawkish Federal Reserve may soon regain their record run against the dollar on expectations that developing central banks may outpace their U.S. counterpart in policy tightening.

The currencies of Brazil, the Czech Republic, Hungary and Poland -- countries that delivered multiple rate hikes or are expected to do so soon -- are retaining quarterly gains and outperforming peers. In comparison, the Fed has signaled it’s likely to lift interest rates only in 2023. Goldman Sachs Group Inc. and JPMorgan Asset Management say that once the dollar’s support from a positioning shift fades, emerging-market currencies could once again roar back.

“A more hawkish Fed could provide a hawkish and FX-friendly impulse for some EM central banks that were thinking of their own policy shifts,” and “may nudge others significantly in that direction,” Goldman strategists including Zach Pandl and Kamakshya Trivedi wrote in a note Sunday.

“Our main arguments for EM FX appreciation over the medium and long runs -- value, hiking cycles that contribute to domestic carry rebuilds, and vaccine-led cyclical recoveries -- should continue to provide support over the summer in a way that is not entirely determined by Fed decision-making,” the strategists added.



U.S. financial conditions are closely correlated with demand for risk assets, including emerging-market stocks and currencies. While taper talk has been the focus of investors’ concerns, they should be watching for signs of tightening financial conditions, which could trigger a selloff, according to Neels Heyneke, a strategist at Nedbank Group Ltd. in Johannesburg.

That’s not happening yet, with U.S. conditions still near the loosest on record, according to the Goldman Sachs U.S. Financial Conditions index. While gauges of emerging-market stocks and currencies have pulled back from all-time highs, they’re still well up this quarter.

With the Fed unlikely to hike in 2021 or 2022, “monetary and financial conditions should remain easy for some time,” said Didier Lambert, JPMorgan Asset Management’s lead portfolio manager for emerging-market fixed income. “EM central banks able to rein in inflation expectations in a credible way -- such as Russia, Czech Republic or Brazil -- may see greater demand for their currencies.”

While some commodities took a hit after the Fed’s latest rate signal, others remain supportive of emerging-market currencies linked to raw-material prices. Raw materials like copper, coal and iron ore hit all-time highs last month, with a rebound in the world’s largest economies stoking demand for metals and energy when supplies are still constrained.

That’s prompting Aberdeen Asset Management to take advantage of any weakness to add to its bullish bets on commodity-linked currencies such as the Brazilian real, as well as the Chilean and Colombian pesos.

“If anything, this is ratification that global growth is strong and so is the demand for commodities,” said Edwin Gutierrez, head of emerging-market sovereign debt at Aberdeen in London. “But let’s see how much of a shake-out there is in those.”

Cyclical RecoveryJPMorgan Asset Management plans to use any market volatility to invest in most emerging-market currencies that will benefit from a cyclical recovery and in selective high-yielding securities. Bullish positions in developing currencies aren’t “overextended,” suggesting that potential losses from a stronger dollar will be limited, said Lambert.

The shift toward tighter monetary policy in developing nations isn’t uniform, however. Some are continuing to support growth as the coronavirus continues to spread, or a new wave of cases emerges.

Central banks in Thailand and the Philippines look set to keep interest rates on hold this week, as the region battles persistent coronavirus outbreaks with only a fraction of the population vaccinated. Poland wants to keep monetary policy loose until the economic rebound is well under way, despite surging inflation.

That means investors should be looking for relative-value trades rather than buying the basket, according to Bank of America Securities, which favors Poland’s zloty over other Central and Eastern European currencies given cheaper valuations and a still relatively dovish central bank, giving it “more scope to reprice when they turn hawkish,” strategists led by David Hauner said in a report.

Brazil Outperforms
The Brazilian real has been the top performer among emerging-market currencies this month, followed by commodity-linked peers such as Russia’s ruble and Colombia’s peso. The forint, zloty and koruna have underperformed.

Brazil’s monetary authority hiked its key interest rate by 75 basis points and opened the door to even bigger increases on Wednesday amid surging inflation forecasts. The nation is among the first to increase its key rate to pre-pandemic levels, taking a more aggressive stance to battle inflationary pressures.

“Brazil is probably the clearest example of a combination of better growth prospects, reduced political noise, more hawkish central bank and undervalued currency to justify its recent outperformance,” the BofA strategists wrote.


Carry Return

Emerging-market local-currency debt posted its biggest weekly drop since March 2020 in the five days through Friday. It’s often seen as the most susceptible to any rise in the dollar or U.S. yields because either of those would reduce the carry return. A Bloomberg News study has identified that a 25-basis-point increase in yields in a month would be the tipping point for moves in higher-yielding currencies such as the Turkish lira, South African rand and Mexican peso.

“While we believe emerging-market currencies are undervalued on a real effective basis, the carry is fairly limited in most currencies,” said Nicholas Ferres, chief investment officer at Singapore-based hedge fund Vantage Point, who prefers to hold Asian stocks.

Some frontier currencies such as the Egyptian pound and Ghanaian cedi will probably hold up better than most of their peers given their “enormous” real-yield advantage, according to Fidelity International.

“A market shake-out over the summer will provide an attractive entry point to get back into emerging-market dollar debt, currencies and local duration,” said Paul Greer, a London-based money manager at the firm, which oversees about $700 billion. “We expect the total returns for the asset class to be better in the second half than in the first half.”

Listen to the EM Weekly Podcast: Mexico, Hungary Rates; Sanctions on Russia

Rate DecisionsHungary’s central bank on Tuesday is poised to start one of the region’s first monetary-tightening cycles to combat the fastest inflation in the European UnionThe forint was one of the biggest losers in emerging markets last week as economists’ forecasts on the size of a potential rate increase varyTraders doubted the central bank will deliver “decisive” monetary tightening, as promised by a deputy governorOn Wednesday, the Czech central bank is predicted by almost all economists to follow suit with a quarter-point hike to 0.5%Thailand and the Philippines will probably keep borrowing costs unchanged on Wednesday and Thursday, respectivelyPolicy makers from both countries are likely to signal “that they won’t adjust policy for quite a while to come,” said Frederic Neumann, co-head of Asian economics research at HSBC Holdings Plc. “With domestic demand still hobbled by Covid-19 restrictions, there is little risk that rising commodity prices will trigger a surge in consumer prices”The Thai baht and the Philippine peso each fell more than 1% last weekChina’s one-year loan prime rate -- the reference rate for bank loans to companies -- remained at 3.85% for a 14th monthThe five-year rate -- the reference rate for mortgages -- was kept at 4.65%Mexico’s central bank is expected to leave its key interest rate steady for a fourth month on Thursday

Traders will watch for any guidance on future policy as the nation’s TIIE curve prices in more than 70 basis points of hikes in the rest of 2021Traders will also monitor Mexico’s April retail sales data on Wednesday, bi-weekly inflation for the first part of June on Thursday, and April economic activity on FridayBrazil’s central bank will release minutes from its most recent policy meeting on Tuesday, which may offer detail on the 75-basis-point Selic increase

The policy makers will also release a quarterly inflation report on Thursday, which will will likely bring a significant upgrade to the BCB’s growth forecast, according to Bloomberg EconomicsBrazil will post mid-June IPCA numbers on current account data for May on FridayWhat Else to WatchSouth Korea’s exports rose 29.5% in the first 20 days of June from a year earlier as the global economy shakes off the effects of the pandemic

Bloomberg Economics expects tight supply and sustained demand for tech products to continue to buoy exports in the months aheadSouth Africa’s inflation probably accelerated to 5.2% in May, the highest in more than two years. That would be in line with the projection model of the central bank, which indicated last month that its interest rate will increase before the end of the yearThe rand was the hardest hit emerging-market currency last weekIn Argentina, investors will watch first-quarter gross domestic product figures on Wednesday for signs of a rebound compared with earlier in the pandemic— With assistance by Sydney Maki, John Viljoen, Karl Lester M Yap, Y-Sing Liau, Lisa Wolfson, and Lilian Karunungan

(Adds comments by Goldman in third and fourth paragraphs.)

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To: elmatador who wrote (2158)7/7/2021 3:24:24 PM
From: Snowshoe
   of 2171
 
Brazilian horse kicks ass... ;)

youtube.com



Occurred on June 30, 2021 / Cascavel, Ceara, Brazil

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