Semana tem CPI dos EUA e balanços no Brasil - Morning Call – Jerson Zanlonrenzi e Lorena Laudares

Summary

The script is a comprehensive morning call by BTG Pactual, discussing the financial market's opening with a focus on international data and macroeconomics. It highlights the importance of US inflation data ahead of the Fed's September meeting and its impact on emerging markets like Brazil. The discussion also covers political uncertainties, particularly the US midterm elections, and their potential to influence inflation and interest rates. Additionally, it touches on the Brazilian economic scenario, including fiscal policy, inflation expectations, and the impact of statements from key economic figures on market sentiment.

Takeaways

• 📈 The script begins with a discussion on the calmer start to the week in the financial markets following a period of high volatility, with the focus on macroeconomic data and the upcoming Federal Reserve meeting.
• 🌐 Internationally, there is anticipation for key economic data releases such as retail sales, industrial production, and the inflation report which are crucial for market sentiment, especially with concerns about a potential recession in the United States.
• 💡 The Brazilian real and other emerging market currencies are particularly sensitive to the US economic outlook, and a 'soft landing' scenario for the US economy is preferable to avoid negative impacts on these markets.
• 📊 The script mentions the importance of aligning market expectations with government fiscal policy and the role of the Central Bank of Brazil in managing inflation expectations.
• 🗓️ Upcoming events in Brazil include the release of retail sales data, employment market figures, and the IBC-BR index, which are significant for the local economy.
• 💼 The script highlights the importance of government officials' speeches and their impact on market expectations, especially regarding fiscal responsibility and monetary policy.
• 🏛️ The discussion includes the potential impact of the US midterm elections on inflation and interest rate normalization, with a focus on the composition of Congress and its stance on economic policies.
• 📉 The script refers to the volatility in commodity markets, particularly iron ore, which is influenced by factors such as Chinese demand and global economic growth prospects.
• 💬 There is mention of the need for clear communication from government officials to anchor market expectations and reduce volatility, especially in relation to fiscal policy and inflation.
• 📊 The script also covers the release of corporate earnings reports from various companies, emphasizing the importance of these reports for understanding the health of the economy and the outlook provided by company executives.
• 📧 Lastly, the script promotes a newsletter service for receiving curated financial information and analysis directly to the subscriber's email, highlighting the value of good information for making investment decisions.

Q & A

What is the main focus of the morning call by BTG Pactual?

The main focus of the morning call by BTG Pactual is to provide insights and updates on the Brazilian economy, macroeconomic data, and long-term structural issues that move the country.

What was the market's condition during the last weekend mentioned in the script?

The market had a relatively calm weekend, with the Systemic Risk Buffer (SMP) opening with a 0.2% increase, Eurostocks being stable, and futures in London showing similar trends.

What are the significant international macroeconomic data points that the script mentions?

The significant international macroeconomic data points mentioned in the script include the release of the Producer Price Index (PPI) on Wednesday, retail sales and industrial production data on Thursday, and the approach of the Federal Reserve's September meeting.

How is the expectation of a recession in the United States affecting the market?

The expectation of a recession in the United States has brought a lot of volatility to the market. The fear of a hard landing has led to a repricing of assets, particularly in the technology sector.

What is the relevance of the CPI number for Brazil in the context of the script?

The CPI number for Brazil is relevant as it reflects the country's inflation situation, which is crucial for understanding the potential impact of external economic conditions, such as a faster interest rate cut in the United States due to a recession.

What is the significance of the Federal Reserve's September meeting mentioned in the script?

The Federal Reserve's September meeting is significant because it is expected to be a key event that could determine the direction of monetary policy, with the market anticipating the start of an interest rate cut cycle.

What are the key domestic economic indicators that will be released during the week according to the script?

The key domestic economic indicators to be released include retail sales data, labor market data, and the IBC-BR index, with the IPCA inflation data being highlighted as particularly important.

What was the outcome of the ministerial meeting discussed in the script?

The ministerial meeting discussed in the script resulted in a correct diagnosis of Brazil's economic issues, including fiscal concerns, uncertainty about the Central Bank's conduct in the next administration, and external issues, which are crucial for market expectations.

How did the script describe the potential impact of the U.S. elections on emerging markets?

The script described the potential impact of the U.S. elections on emerging markets as significant, particularly if there is a structurally higher inflation in the United States, which could lead to a faster normalization of interest rates and affect market stability.

What is the importance of the statements by Roberto Campos Neto, Galipólo, and Fernando Haddad mentioned in the script?

The importance of the statements by Roberto Campos Neto, Galipólo, and Fernando Haddad lies in their potential to align market expectations regarding fiscal policy, inflation control, and the credibility of the Central Bank, which are crucial for the economic outlook.

What is the significance of the corporate earnings season in Brazil as mentioned in the script?

The corporate earnings season in Brazil is significant as it provides insights into the performance of major companies, their guidance for the current quarter, and the overall health of the Brazilian economy.