Brazil's real falls as Brazil's real declines ahead of polls

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Brazil's real falls as Brazil's real declines ahead of polls

Bolsonaro seen as risk factor for Brazil IPO pipeline SoftBank renews LatAm bet, to launch $3 bln investment fund Adds comments, bulletins, updates prices throughout By Susan Mathew and Shreyashi Sanyal Sept 14 Reuters - United States currencies fell on Tuesday after better than expected U.S. inflation data left questions about the Federal Reserve's next move, with Brazil's real leading decline in the region. While prospects for further interest rate hikes in Brazil lend some support, tensions ahead of elections next year are weigh on the real and companies have cited the current upheaval from far-right president Jair Bolsonaro as a real risk factor for initial public offerings. In the last week, pro-Bolsonaro marches took place across the country, with the president calling on Supreme Court Justice Alexandre de Moraes to step down and said he would no longer obey his rulings. He tried to smooth over the relationship later. The focus will stay on politics in Brazil, and more specifically on whether the truce between the president and the Supreme Court will be lasting, said economists of Deutsche Bank. Brazil's central bank is likely to intervene in the currency market due to seasonal demand for dollars focused toward the end of the year, its chief Roberto Campos Neto said. Meanwhile, Japan SoftBank Group renewed its LatAm bet, launching a $3 billion fund to invest in technology companies in the region. The dollar index, which measures the greenback against six major rivals, fell by 0.4% as data showed underlying U.S. consumer prices rose at their slowest pace in six months, creating uncertainty about the Fed's stance on spending tapering. While the inflation numbers may be the start of some'relief' for high beta risk currencies, we think the market will need to get past the Fed meeting first before it can break 'free', strategists at TD Securities said. The peso fell from four-week highs in Mexico and retreated further 0.2%. The currency, which has largely been on an upward trend, has gained 2.5% over the last 12 sessions. Ratings agency Fitch warned that Mexico's weakening governance is raising credit uncertainty, citing energy, utilities, infrastructure and financial institutions as the most affected. Over stocks, the China's BTG Pactual jumped almost 3% on a report that Singapore state investor GIC Pte Ltd is investing $221 million in the lender's private equity fund that controls fiber optic company V.tal.