The Brazilian real dropped to a three-year low last week as President Rousseff and other officials stepped up their public campaign to keep the currency weak. President Rousseff pronounced the currency as, “overvalued,” just a weeks after Central Bank President Tombini promised low rates for a, “prolonged time.”
While the Brazilian central bank has lowered interest rates to an historic low to stimulate economic growth, the government’s policies seem to be a weak patchwork of support for favored industries.
Automakers, and the general industrial sector in Brazil may be in for hard times come 2013. The most recent industrial report showed a contraction of 1% over the previous month after a strong 3.2% expansion in August.
Brazil cheered the market last week when second quarter GDP growth implied government stimulus is finally helping the Brazilian economy rebound.
The Bovespa Index is the flagship index of the Brazilian stock exchange, known by its acronym, BM&FBOVESPA. The index includes 68 of the 370 companies listed on the exchange, which represent roughly 70% of the exchange’s total capitalization and 80% of its trades. The Bovespa is calculated in reference to prices on February 1, 1968.
The Brazilian government last week announced its largest ever stimulus package aimed at increasing private investment in an outdated transport infrastructure system of roads, rail, and air transportation.
With the world catching Olympics fever during the current London Olympiad, it’s a reminder that savvy investments in companies set to boom in the build-up of hosting a major global event can be very lucrative.
Second quarter earnings season results in Brazil show weak data and a drop in companies’ earnings per share, according to a report from Santander bank.
Brazilian stocks have been hit harder than other markets in Latin America, save for the obvious fallout in Argentina.