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Markets Consolidate After Busy Week

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  • 5.30 once again caps the USDBRL price action as the Real advanced around 1% on Tuesday. The BCB minutes reinforced the prospect that policy makers will raise interest rates above neutral, but did not provide any signal on the terminal level of this cycle. Today we will see June Retail Sales data before the important US CPI releases.
  • 1300BST/0800ET:
    • June Retail Sales YoY, est. 8.6%, prior 16.0%
    • June Retail Sales MoM, est. 0.5%, prior 1.4%
  • Importantly on Tuesday, Brazil's lower house rejected a bill to implement printed ballots in the next year elections. The vote was 229 in favour and 218 against.
    • President Bolsonaro didn't get the 308 votes he needed to change Brazil's voting system, but local analysts point out that a simple majority does still potentially hand him a valuable talking point in his quest over the next 14 months to undermine faith in the election.
    • "The lower house has given a democratic answer to this matter, and I hope it's definitely buried," Speaker Arthur Lira said in announcing the result.