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Brazil used the first trade war Donald Trump as an opportunity to enhance its exports. Currently, in negotiations with China, Mexico and Japan to achieve a similar result. This is just one of the many strategic advantages that Brazil possesses. Let’s discuss this topic and develop a trading plan for USDBRL husband.
The article covers the following topics:
Main meals
- The real Brazilian is among the three best currencies in Forex.
- Brazil’s trade war will allow exports to increase.
- The capital flow will support the real stock index.
- Short deals can be opened on a USDBRL pair with goals at 5.56 and 5.35.
Monthly basic expectations for the real Brazilian
In the current economic climate, it is necessary to determine potential opportunities amid continuous turmoil. While investors discuss those who will suffer more than the World Trade War – the United States, China or the European Union – there is one clear thing: Brazil will gain greatly from this position. Eight years ago, it benefited from commercial tensions between Washington and Beijing to enhance its exports, and now Brazilia is taking advantage of this experience in a proactive way. This is one of the main factors that contribute to a decrease of 8 % year to date in USDBRL an average.
The realistic Brazilian outperformed other major currencies, ranked third among the thirty currencies that Bloomberg follows, after the Russian robos and Swedish Karra. Brazil is a relatively closed economy, as exports represent 18 % of GDP. In comparison, Mexico has 30 %, Canada has 33 %, and Germany has 42 %. This indicates that the country of South America will be less affected by commercial wars and slowdown in the global economy. In addition, the deficit in foreign trade in Brazil with the United States relieves the risk of insertion in the blacklist.
American trade deficit
Source: Bloomberg.
During the first trade war of Donald Trump, Brazil spoke successfully China to buy its agricultural products in retaliation against the United States. As a result, American farmers suffered losses of about $ 26 billion. Nowadays, the President of Brazil, Luiz Insio Lula da Silva, negotiates with Mexico, Japan and China, and provides them with their goods. And he confirms that the White House should not be a global honorable and that other countries should overcome protectionism to the United States to ensure free trade.
Besides the increase in exports and growth of GDP associated with it, Brazil and its national currencies can rely on another strong Trump card – the capital of the United States to South America. The IBVSPA stock index increased by 18 % in US dollars, spreading its best performance since 2022. This result exceeded the performance of emerging markets, not to mention a 4.6 % decrease in the S&P 500 index.
Perform international stock indicators
Source: Bloomberg.
Brazilian stocks showed noticeable gains due to a lack of value. In 2024, the US stock index increased by more than 20 %, while its counterpart in South America decreased by 30 % due to budget concerns. This has led to the P/E 7.48 ratio for IBovesPa and 20.6 for the S&P 500. Foreign investors have shown remarkable attention, as investments in the stock market in Brazil reach $ 12 billion, which is the highest number since 2022, driven by the country’s summit and a favorable result expected in continuous trade negotiations.
Monthly USDBRL trading plan
Brazil can obtain the utmost benefit from the crisis in international trade, global economy, increasing exports, and attracting foreign capital to its market. Against this background, USDBRL The husband is likely to continue trading in a declining direction, as it reaches 5.56 and 5.35 levels. Therefore, the sale of Greenback against the real decline can be a profitable trading chance.
This expectation depends on an analysis Basic factorsIncluding official data from financial institutions and organizers, various geopolitical and economic developments, and statistical data. Historical market data is also.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of the Litefinance Mediator. The materials published on this page are provided for media purposes only and should not be considered to be considered investment advice for guidance purposes 2014/65/European Union.
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