Category: Macroeconomy/Finance

Information regarding Brazil’s finance sector and the country’s macroeconomy.

Brazil congressional committee approves 2020 budget

A Brazilian congressional committee on Tuesday approved the government’s budget for next year, with the bill based on projected 2.32% GDP growth in 2020 to be put to a vote in a joint session of Congress on Wednesday. The government projections contained in the budget proposal see inflation at 3.52% for next year, the benchmark Selic interest target at 4.40% and an average exchange rate of 4 reais to the dollar.

Banking Apps Spread In Brazil As Critics Note Potential For Shakeout

With a bewildering number of choices, banking apps fuelled by Tencent Holdings Ltd, SoftBank Group Corp, and other players are spreading in Brazil, as some critics note a shakeout is looking more probable. Customers buy products, get loans and open checking accounts that are no-fee by tapping into digital wallets from merchants like Lojas Americanas, the Avai football team, or the MercadoLibre shopping platform, Reuters reported.

Foreign investors cast shadow over bumper Brazilian markets

It is likely that foreign investors have been less willing to buy into Brazil’s recovery story than locals have. Reform momentum appears to have stalled after the passage of a landmark pension reform this year. Despite signs of nascent economic growth after a deep recession in 2015-16, unemployment is persistent at almost 12 per cent. Household debt is rising and its quality is deteriorating.

Central Bank Cuts SELIC Interest Rate 4.5%

In a statement, the Central Bank pointed out that it sees the Brazilian economy gaining ground and that “the recovery will continue at a gradual pace”. The Monetary Policy Committee (COPOM) decided on Wednesday to cut the SELIC by 0.5 percentage point for the fourth consecutive time, bringing interest rates down to 4.5 percent, the lowest basis interest rate in history.

Brazil to honour $465 mn in UN and BRICS bank debts but no other in 2019

The federal government will pay debts of R$1.815 billion to the United Nations (UN) and the BRICS bank (a group comprising Brazil, Russia, India, China and South Africa) by the end of the year. On the other hand, it will no longer honor commitments to the Latin American Development Bank (CAF), the Inter-American Investment Corporation (IDB Invest), the Financial Fund for the Development of the La Plata Basin (FONPLATA), and the International Development Agency (IDA).

Brazil XP’s Valued at $14.9 Billion as IPO Tops Target Range

XP Inc., Brazil’s largest brokerage by equity-trading volume, raised $1.96 billion in its U.S. initial public offering, pricing its shares above the marketed range. The company and its existing shareholders sold 72.5 million shares Tuesday for $27 each after offering them for $22 to $25, according to a statement. That gives XP a market value of about $14.9 billion based on the outstanding shares.