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BRAZIL: FX Credit Line Auction Expected Today, Sept Service Volume Due

BRAZIL
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  • The BCB has called a FX credit-line auction of as much as $4bn on Wednesday, according to a statement published yesterday, the first such auction since January 2023. Two auctions will be held simultaneously, with a maximum of $2bn accepted for each. Proposals will be accepted from 1330GMT(0830ET) to 1335GMT(0835ET). Settlement of the purchase transactions dates will be on April 2, 2025 for one auction and July 2, 2025 for the other, according to Bloomberg.
  • The announcement comes as continued fiscal uncertainty weighs on local assets, with USDBRL up by almost 6% since the start of October. As noted, Valor reported yesterday that President Lula will meet with one more ministry today (the Defence Ministry) before concluding the negotiations over the spending cut plans.
  • On the data front, services volume for September will be released at 1200GMT(0700ET), with consensus for a pick-up in growth to 3.4% y/y, from 1.7%.
    • Sept. IBGE Services Volume YoY NSA, est. 3.4%, prior 1.7%
    • Sept. IBGE Services Volume MoM SA, est. 0.7%, prior -0.4%
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  • The BCB has called a FX credit-line auction of as much as $4bn on Wednesday, according to a statement published yesterday, the first such auction since January 2023. Two auctions will be held simultaneously, with a maximum of $2bn accepted for each. Proposals will be accepted from 1330GMT(0830ET) to 1335GMT(0835ET). Settlement of the purchase transactions dates will be on April 2, 2025 for one auction and July 2, 2025 for the other, according to Bloomberg.
  • The announcement comes as continued fiscal uncertainty weighs on local assets, with USDBRL up by almost 6% since the start of October. As noted, Valor reported yesterday that President Lula will meet with one more ministry today (the Defence Ministry) before concluding the negotiations over the spending cut plans.
  • On the data front, services volume for September will be released at 1200GMT(0700ET), with consensus for a pick-up in growth to 3.4% y/y, from 1.7%.
    • Sept. IBGE Services Volume YoY NSA, est. 3.4%, prior 1.7%
    • Sept. IBGE Services Volume MoM SA, est. 0.7%, prior -0.4%