Direct Treasury: Fixed rate of up to 12.29% with external risk aversion

Direct Treasury: Fixed rate of up to 12.29% with external risk aversion

General bond prices are rising sharply on Friday afternoon (19). In fixed-rate securities, prices advance up to 21 basis points, while in inflation-linked bonds, the advance is up to 7 basis points.

According to Igor Kavaca, director at Warren Asset Management, the move is a result of the increased risk premium in Brazil in relation to international sovereign assets.

It highlights the more aggressive speeches of the leaders of the Federal Reserve (the Federal Reserve, the US Central Bank) the previous day, indicating the continuation of a tougher stance in US monetary policy, after doves (Less worried about inflation) for the Fed meeting minutes.

“This was one of the main drivers of today’s move, we saw US stocks fall, US interest rates go up, and the Brazilian stock market goes down,” Kavaca comments.

Warren Asset Management’s director also noted persistent inflation in Germany, even with “staggering” economic activity, which ended up adding uncertainty to the markets.

Germany’s Producer Price Index (PPI) jumped 37.2% in July compared to the same month in 2021, according to data published Friday by Destatis, as the country’s statistics agency is known.

The result was well above the expectations of analysts interviewed by the Wall Street Journal, who had expected a rise of 31.5%.

On the market’s radar which could affect the yield curve next week, Kavaka cites political news, with additional moves in government prices expected for 2023. “The international market should continue to influence the domestic market,” he asserts.

Under Treasury Direct, the largest increase was in short-term fixed-rate bonds. The 2025 flat rate treasury offered an annualized return of 12.24%, up from the 12.03% seen in the previous session.

Fixed rate treasury 2029 and fixed rate treasury 2033, at semi-annual interest, generated annual returns of 12.16% and 12.29%, respectively, up from 11.98% and 12.10% recorded the day before.

In inflation-linked bonds, interest rates rose 6 basis points, excluding the IPCA + 2032 Treasury .74% offered Thursday (18).

The biggest real gain among bonds was 5.90%.

Check prices and quotes for all public securities available for purchase from Treasury Direct on Friday afternoon (19):

Source: Direct Treasure

United Kingdom and Germany

In Europe, investors are mirroring Germany’s Producer Price Index (PPI), which jumped 37.2% in July compared to the same month in 2021, according to data published Friday by the country’s statistics agency Destatis.

The result was much higher than the expectations of the analysts I interviewed The The Wall Street JournalWhich expected an increase of 31.5%.

The annual rate of the producer price index accelerated to 32.7% in June. Compared to the previous month, the index rose 5.3% in July. This was the largest month-to-month increase ever recorded in the historical series. Experts expected a 0.7% increase in the monthly comparison.

UK retail data is also featured. According to the Office for National Statistics (ONS), sales volume in the sector grew by 0.3% month-on-month, but declined by 3.4% year-on-year.

Economists have consulted before The Wall Street Journal Retail sales are expected to decline 0.2% in July.

In out-of-store retail – mostly online retailers – sales increased 4.8% in July.

Datafolha and tax increase

Two days after the official start of the campaign period, former President Luis Inacio Lula da Silva (PT) maintained his leadership in the dispute over the Planalto Palace. This is what was released yesterday (18) a survey conducted by the Datafolha Institute, commissioned by Globo Group And the newspaper Folha DS Paulo.

According to the survey, Lula left 47% of voting intentions in a catalyst scenario for the first round – a level that has been maintained since the penultimate poll released by the institute on June 22. Bolsonaro has risen and now has the support of 32% of voters – a cumulative growth of 5 percentage points since May 25.

On the political front, Paulo Guedes, Minister of Economy, said yesterday (18) that the government intends to increase taxes for those who earn more, and to simplify taxes in return. He commented, “The collection base increases and this larger collection drives the transfer of income.”

During his participation in the BTG Pactual event, the Minister advocated a combination of economic policy based on government social action, private investment and better management of public capital.

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