{"id":95434,"date":"2025-08-20T16:51:41","date_gmt":"2025-08-20T19:51:41","guid":{"rendered":"https:\/\/murray.adv.br\/?p=95434"},"modified":"2025-08-20T16:51:41","modified_gmt":"2025-08-20T19:51:41","slug":"local-assets-fall-as-brazil-u-s-tensions-escalate","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/","title":{"rendered":"Local assets fall as Brazil-U.S. tensions escalate"},"content":{"rendered":"
\n
\n
\n
Ibovespa drops 2%, dollar nears R$5.50, and long-term rates rise sharply after Supreme Court ruling; poll rumor also weighs on prices<\/strong><\/em><\/h6>\n<\/div>\n<\/div>\n
\n
\n
\n
\n
<\/div>\n

 <\/p>\n

 <\/p>\n

08\/20\/2025\u00a0<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n

\n
\n
\n
<\/div>\n
\n

Brazilian markets reacted strongly to a fresh escalation in diplomatic tensions with the United States. Heightened risk perception fueled a sharp increase in future interest rates and sent the dollar close to R$5.50, while the Ibovespa took a hit from steep losses in bank stocks.\u00a0The sell-off intensified after Washington toughened its rhetoric in response to a ruling by Federal Supreme Court<\/a>\u00a0(STF) Justice Flavio Dino, who determined that foreign laws have no immediate effect in Brazil, raising concerns about the potential impact of the Magnitsky Act on the domestic financial sector.<\/p>\n<\/div>\n

\n
\n

Risk aversion deepened in the afternoon as traders also began factoring in the political landscape. Rumors about new popularity polls for President Luiz In\u00e1cio Lula da Silva rattled markets further, particularly in currency and interest rate trading.<\/p>\n<\/div>\n

\n

In just two sessions, the real erased all of its recent gains, with the dollar closing up 1.19% at R$5.4993, the highest level since August 5. In the rates market, intermediate maturities priced in significant risk premiums, with the January 2029 DI climbing from 13.235% to 13.48%, its highest since July 31.<\/p>\n<\/div>\n

\n

The Ibovespa, which had avoided Monday\u2019s risk-off mood, ended Tuesday down 2.10% at 134,432 points, dragged by heavy losses in bank shares.<\/p>\n<\/div>\n

\n

Real interest rates, measured by NTN-Bs (inflation-linked government bonds), also moved higher. Yields rose more than 10 basis points across nearly all maturities, reflecting both market stress and a hefty R$1.3 million supply of NTN-Bs offered by the National Treasury on Tuesday.<\/p>\n<\/div>\n

\n

According to SulAm\u00e9rica Investimentos CIO Lu\u00eds Garcia, the market had remained relatively calm when tensions were limited to trade frictions or sanctions against specific officials. \u201cBut the Supreme Court\u2019s signal could prompt a counter-response from Washington and lead to a much more troubling scenario,\u201d he said.<\/p>\n<\/div>\n

\n

Mr. Garcia warned that the greatest risk would be U.S. sanctions affecting Brazil\u2019s access to the Swift payment system, which connects financial institutions worldwide. Such a move, he said, could disrupt foreign capital inflows, push the dollar back toward R$6, and fuel inflation expectations, potentially jeopardizing the Central Bank\u2019s rate-cutting cycle.<\/p>\n<\/div>\n

\n

The worst-case scenario, he added, would involve measures affecting not just new flows but also existing investments in Brazil.<\/p>\n<\/div>\n

\n

For now, SulAm\u00e9rica is taking tactical positions in local markets rather than holding assets for long. If tensions ease, Mr. Garcia sees room for the real to strengthen further and for future rates to fall, supported by Brazil\u2019s monetary easing cycle.<\/p>\n<\/div>\n

\n

Still, he noted that long-term rates have remained stubbornly high, even during periods of market optimism. \u201cThe exchange rate is the most popular risk gauge, but it doesn\u2019t reflect fiscal concerns as strongly as the long end of the curve,\u201d he said.<\/p>\n<\/div>\n

\n

Adding to the day\u2019s volatility, traders circulated rumors that an upcoming poll would show improving electoral prospects for the government, prompting investors to demand higher risk premiums.<\/p>\n<\/div>\n

\n

A foreign fund manager, who requested anonymity, said risks are far from benign, especially since U.S. sanctions are politically driven and likely to escalate tensions. \u201cUnder these circumstances, markets can quickly turn very volatile, with rumors surfacing and undermining investor confidence even when denied,\u201d the manager said.<\/p>\n<\/div>\n

\n

On the political front, he argued that polls should not yet carry such weight, given the time remaining before elections and uncertainty over candidates. \u201cBut something has broken in the positive momentum, and that will have a lasting effect on investor confidence,\u201d he said. \u201cI\u2019ll be more cautious going forward, especially in FX, and this reinforces my view that the DI curve should steepen\u2014with weaker growth requiring lower short rates, while shaken confidence drives outflows at the long end.\u201d<\/p>\n<\/div>\n

\n
\n

But not all share this skeptical outlook for the real. Nelson Rocha Augusto, chief economist and president of BRP, projects the dollar closer to R$5.40 by year-end, despite short-term swings. \u201cI see four factors supporting this view: the interest rate spread will remain wide; U.S. exceptionalism will erode; as inflation falls and rates come down, foreigners will have better visibility for calculations and direct investment should increase; and tensions with Washington are likely to ease after the trial of former president Jair Bolsonaro,\u201d he said.<\/p>\n

*By\u00a0Gabriel Caldeira,\u00a0Bruna Furlani,\u00a0Maria Fernanda Salinet\u00a0and\u00a0Arthur Cagliari\u00a0\u00a0\u2014 S\u00e3o Paulo<\/p>\n

Source: Valor International<\/p>\n

https:\/\/valorinternational.globo.com\/<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Ibovespa drops 2%, dollar nears R$5.50, and long-term rates rise sharply after Supreme Court ruling; poll rumor also weighs on prices     08\/20\/2025\u00a0 Brazilian markets reacted strongly to a fresh escalation in diplomatic tensions with the United States. Heightened risk perception fueled a sharp increase in future interest rates and sent the dollar close […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[26347],"class_list":["post-95434","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-local-assets-fall-as-brazil-u-s-tensions-escalate"],"yoast_head":"\nLocal assets fall as Brazil-U.S. tensions escalate - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Local assets fall as Brazil-U.S. tensions escalate - Murray Advogados\" \/>\n<meta property=\"og:description\" content=\"Ibovespa drops 2%, dollar nears R$5.50, and long-term rates rise sharply after Supreme Court ruling; poll rumor also weighs on prices     08\/20\/2025\u00a0 Brazilian markets reacted strongly to a fresh escalation in diplomatic tensions with the United States. Heightened risk perception fueled a sharp increase in future interest rates and sent the dollar close […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\" \/>\n<meta property=\"og:site_name\" content=\"Murray Advogados\" \/>\n<meta property=\"article:published_time\" content=\"2025-08-20T19:51:41+00:00\" \/>\n<meta name=\"author\" content=\"Gelcy Bueno\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Gelcy Bueno\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\"},\"author\":{\"name\":\"Gelcy Bueno\",\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e\"},\"headline\":\"Local assets fall as Brazil-U.S. tensions escalate\",\"datePublished\":\"2025-08-20T19:51:41+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\"},\"wordCount\":740,\"keywords\":[\"Local assets fall as Brazil-U.S. tensions escalate\"],\"articleSection\":[\"Murray News\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\",\"url\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\",\"name\":\"Local assets fall as Brazil-U.S. tensions escalate - Murray Advogados\",\"isPartOf\":{\"@id\":\"https:\/\/murray.adv.br\/en\/#website\"},\"datePublished\":\"2025-08-20T19:51:41+00:00\",\"author\":{\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e\"},\"breadcrumb\":{\"@id\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"In\u00edcio\",\"item\":\"https:\/\/murray.adv.br\/en\/home\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Local assets fall as Brazil-U.S. tensions escalate\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/murray.adv.br\/en\/#website\",\"url\":\"https:\/\/murray.adv.br\/en\/\",\"name\":\"Murray Advogados\",\"description\":\"PLG International Lawyers\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/murray.adv.br\/en\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e\",\"name\":\"Gelcy Bueno\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/murray.adv.br\/en\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/1ef2acfe966d6deacdeccd2a24ea89192c41fd05fc60e57b79021358a47f5641?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/1ef2acfe966d6deacdeccd2a24ea89192c41fd05fc60e57b79021358a47f5641?s=96&d=mm&r=g\",\"caption\":\"Gelcy Bueno\"},\"url\":\"https:\/\/murray.adv.br\/en\/author\/news\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Local assets fall as Brazil-U.S. tensions escalate - Murray Advogados","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/","og_locale":"en_US","og_type":"article","og_title":"Local assets fall as Brazil-U.S. tensions escalate - Murray Advogados","og_description":"Ibovespa drops 2%, dollar nears R$5.50, and long-term rates rise sharply after Supreme Court ruling; poll rumor also weighs on prices     08\/20\/2025\u00a0 Brazilian markets reacted strongly to a fresh escalation in diplomatic tensions with the United States. Heightened risk perception fueled a sharp increase in future interest rates and sent the dollar close […]","og_url":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/","og_site_name":"Murray Advogados","article_published_time":"2025-08-20T19:51:41+00:00","author":"Gelcy Bueno","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Gelcy Bueno","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/#article","isPartOf":{"@id":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/"},"author":{"name":"Gelcy Bueno","@id":"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e"},"headline":"Local assets fall as Brazil-U.S. tensions escalate","datePublished":"2025-08-20T19:51:41+00:00","mainEntityOfPage":{"@id":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/"},"wordCount":740,"keywords":["Local assets fall as Brazil-U.S. tensions escalate"],"articleSection":["Murray News"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/","url":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/","name":"Local assets fall as Brazil-U.S. tensions escalate - Murray Advogados","isPartOf":{"@id":"https:\/\/murray.adv.br\/en\/#website"},"datePublished":"2025-08-20T19:51:41+00:00","author":{"@id":"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e"},"breadcrumb":{"@id":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/murray.adv.br\/en\/local-assets-fall-as-brazil-u-s-tensions-escalate\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"In\u00edcio","item":"https:\/\/murray.adv.br\/en\/home\/"},{"@type":"ListItem","position":2,"name":"Local assets fall as Brazil-U.S. tensions escalate"}]},{"@type":"WebSite","@id":"https:\/\/murray.adv.br\/en\/#website","url":"https:\/\/murray.adv.br\/en\/","name":"Murray Advogados","description":"PLG International Lawyers","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/murray.adv.br\/en\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/murray.adv.br\/en\/#\/schema\/person\/dd0d0bea46c2436124555d18c1a0d52e","name":"Gelcy Bueno","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/murray.adv.br\/en\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/1ef2acfe966d6deacdeccd2a24ea89192c41fd05fc60e57b79021358a47f5641?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/1ef2acfe966d6deacdeccd2a24ea89192c41fd05fc60e57b79021358a47f5641?s=96&d=mm&r=g","caption":"Gelcy Bueno"},"url":"https:\/\/murray.adv.br\/en\/author\/news\/"}]}},"_links":{"self":[{"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/posts\/95434","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/comments?post=95434"}],"version-history":[{"count":2,"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/posts\/95434\/revisions"}],"predecessor-version":[{"id":95436,"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/posts\/95434\/revisions\/95436"}],"wp:attachment":[{"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/media?parent=95434"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/categories?post=95434"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/murray.adv.br\/en\/wp-json\/wp\/v2\/tags?post=95434"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}