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President Lula May Call Venezuela President Maduro Today

BRAZIL
  • USDBRL fell 1.05% to 5.6627 yesterday, reflecting a more stable risk backdrop and the more hawkish messaging from the BCB minutes, which indicated that the Copom is willing to hike rates if conditions make it necessary. Overall, bullish conditions in USDBRL remain intact following the breach of key resistance at 5.7008, the Jul 2 high. The break confirms a resumption of the uptrend and opens 5.8981, the 1.764 projection of the Dec 27 ‘23 - Apr 16 - May 3 price swing. On the downside, initial support lies at 5.6090, the 20-day EMA.
  • On the data front today, FGV IGP-DI inflation will be published at 1200BST(0700ET), with consensus for a 0.71% m/m increase in prices, lifting the annual rate to 4.02% y/y, from 2.88%. Later, July vehicle sale will be released at 1400BST.
  • Meanwhile, President Lula may hold a call with Venezuela’s President Nicolas Maduro today, according to O Globo. It is not yet known whether the leaders of Mexico and Colombia will participate in the talks with Maduro, seeking a solution to the political crisis in Venezuela.

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