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Emergency Bill Vote Scheduled For Wednesday


The focus this week will be on the Emergency bill, which is expected to go to a vote on Wednesday. The vote was scheduled for last Thursday but was postponed amid a divergence of lawmakers' opinions.

  • This prompted local assets to trade on the backfoot. Evidence of this was markets fully pricing in a 50 basis points cut of the Selic rate at the BCB's next meeting on March 17th.
  • Additionally, BRL was the second-worst performer among 24 emerging-market currencies tracked by Bloomberg last week, down 3.9%. This was despite multiple rounds of central bank intervention in the currency market, via FX USD spot auctions. On Friday, via two auctions, the central bank sold $1.545 billion and this was not enough to bolster the Real which closed towards it's worst levels of since November.
This morning, Brazil economists raised their 2021 CPI forecast to 3.87% from 3.82%.
  • 1300GMT/0800ET - Brazil Markit PMI Manufacturing – Prior 56.5
  • 1800GMT/1300ET – Brazil Feb Trade Balance – Expected surplus $800 million vs prior deficit of $1.125 billion

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