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Lula Taking Firm Stance Post Weekend Riots

BRAZIL
  • President Luiz Inacio Lula da Silva said this Monday that riots in Brasilia on Sunday caught all govt members by surprise. He claimed that federal district police were negligent, speaking during a meeting with governors in Brasilia.
    • Lula added that rioters will remain in jail until the conclusion of investigations.
    • Separately, US President Biden has invited Brazil President Lula to Washington in early February for talks on shared agenda, according to a statement released by the White House.
  • Despite local markets opening with a downward bias on Monday, developments were largely taken in stride, with DI swap rates reversing and the currency posting a small decline on the day.
  • JPMorgan noted overnight that “while fiscal and political risks are greater than we anticipated before the elections, current valuations continue to support our bullish views on local assets”.
  • Today, the treasury auctions Selic-linked LFT notes due 2026 and 2029; inflation-linked NTN-B local notes due 2028, 2040 and 2060.

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