Brazil's Financial Morning Call For September 29, 2025

(MENAFN- The Rio Times) Brazil's financial markets open today with cautious optimism, buoyed by a sharply narrowed external gap and a surge in foreign direct investment (FDI) signaling robust economic resilience.

According to recent data, Brazil's current account deficit dropped to $33.5 billion in August 2025 (1.5% of GDP), driven by a 15% rise in FDI to $75 billion year-to-date, particularly in manufacturing and services. This bullish signal supports the real's stability and investor confidence despite global uncertainties.

However, the market is also digesting Gol's Abra halting merger talks with Azul due to shifting market dynamics, reflecting challenges in consolidating Brazil's aviation sector amid rising fuel costs and competitive pressures.

Additionally, Brazil's new Supreme Court chief, Justice Luiz Fux, has vowed to curb solo judicial rulings, aiming to restore institutional stability and bolster investor trust in governance, which could positively influence market sentiment.

Today's economic agenda is packed with critical indicators shaping Brazil's trade-driven economy. The BCB Focus Market Readout at 7:25 AM EST (8:25 AM BRT) will provide market forecasts for inflation, GDP, and the Selic rate, crucial for gauging monetary policy amid the 15% Selic rate and global trade tensions.



The IGP-M Inflation Index at 7:00 AM EST (8:00 AM BRT) will offer insights into wholesale inflation trends, impacting producer costs and consumer prices.

Bank Lending data at 7:30 AM EST (8:30 AM BRT) will signal credit availability, vital for domestic growth, while CAGED Net Payroll Jobs at 1:30 PM EST (2:30 PM BRT) will reflect labor market health, influencing consumption and economic momentum.

Global events, such as the EUR Business and Consumer Survey at 5:00 AM EST (6:00 AM BRT) and USD Pending Home Sales at 10:00 AM EST (11:00 AM BRT), will affect demand for Brazil's commodity exports and the real's trajectory.

These releases are pivotal for navigating Brazil's economic outlook amid resilient domestic signals and external pressures.
Economic Agenda
Brazil

• 7:00 AM EST / 8:00 AM BRT – IGP-M Inflation Index (MoM) (Sep): Consensus 0.35%, Previous 0.36%. Tracks wholesale inflation, critical for producer costs and consumer price trends in a high-rate environment.
  
• 7:25 AM EST / 8:25 AM BRT – BCB Focus Market Readout: Actual TBD, Consensus TBD, Previous TBD. Aggregates market forecasts for inflation, GDP, and Selic rate, shaping monetary policy expectations amid 15% Selic rate and FDI-driven optimism.
  
• 7:30 AM EST / 8:30 AM BRT – Bank Lending (MoM) (Aug): Consensus TBD, Previous 0.4%. Signals credit availability, impacting domestic investment and growth.
  
• 1:30 PM EST / 2:30 PM BRT – CAGED Net Payroll Jobs (Aug): Consensus 160.00K, Previous 129.78K. Reflects labor market strength, influencing consumption and economic resilience.
  

Key Events
Asia

• 1:00 AM EST / 2:00 AM BRT – JPY Coincident Indicator (MoM) (Jul): Actual -1.8%, Consensus -2.6%, Previous 0.7%. Tracks economic activity, relevant for Asian demand for Brazilian exports.
  
• 1:00 AM EST / 2:00 AM BRT – JPY Leading Index (MoM) (Jul): Actual 1.1%, Consensus 0.8%, Previous 0.8%. Signals future economic trends, impacting commodity demand.
  
• 1:30 AM EST / 2:30 AM BRT – JPY BoJ Board Member Noguchi Speaks: Provides monetary policy signals, influencing risk sentiment for Brazilian assets.
  
• 7:30 PM EST / 8:30 PM BRT – CNY Manufacturing PMI (Sep): Consensus 49.6, Previous 49.4. Gauges industrial activity, critical for Brazil's commodity exports.
  
• 7:45 PM EST / 8:45 PM BRT – CNY Caixin Manufacturing PMI (MoM) (Sep): Consensus 50.2, Previous 50.5. Signals private-sector manufacturing, affecting iron ore and copper demand.
  

Europe

• 3:00 AM EST / 4:00 AM BRT – EUR Spanish CPI (YoY) (Sep): Actual 2.9%, Consensus 3.1%, Previous 2.7%. Tracks inflation, influencing Eurozone demand for Brazilian goods.
  
• 5:00 AM EST / 6:00 AM BRT – EUR Business and Consumer Survey (Sep): Consensus 95.2, Previous 95.2. Gauges economic sentiment, impacting export pricing.
  
• 5:00 AM EST / 6:00 AM BRT – EUR Consumer Confidence (Sep): Consensus -14.9, Previous -14.9. Signals demand trends for Brazilian exports.
  
• 5:00 AM EST / 6:00 AM BRT – EUR ECB's Schnabel Speaks: Policy remarks affect Eurozone liquidity and Brazilian trade.
  
• 5:00 AM EST / 6:00 AM BRT – EUR German Buba President Nagel Speaks: Economic insights influence commodity demand.
  
• 8:00 AM EST / 9:00 AM BRT – EUR ECB's Lane Speaks: Policy signals impact risk appetite for Brazilian assets.
  
• 9:00 AM EST / 10:00 AM BRT – EUR French 12-Month BTF Auction: Consensus TBD, Previous 2.048%. Signals short-term yields, affecting liquidity flows to Brazil.
  
• 9:00 AM EST / 10:00 AM BRT – EUR French 3-Month BTF Auction: Consensus TBD, Previous 2.007%. Influences short-term capital flows.
  
• 9:00 AM EST / 10:00 AM BRT – EUR French 6-Month BTF Auction: Consensus TBD, Previous 2.027%. Impacts mid-term yields and Brazilian export markets.
  

North America

• 7:30 AM EST / 8:30 AM BRT – USD Fed Waller Speaks: Fed remarks influence dollar strength and the Brazilian real.
  
• 8:30 AM EST / 9:30 AM BRT – CAD Manufacturing Sales (MoM) (Aug): Consensus TBD, Previous 2.5%. Signals demand for Brazilian industrial exports.
  
• 10:00 AM EST / 11:00 AM BRT – USD Pending Home Sales (MoM) (Aug): Consensus 0.2%, Previous -0.4%. Reflects U.S. housing demand, impacting commodity exports.
  
• 10:30 AM EST / 11:30 AM BRT – USD Dallas Fed Mfg Business Index (Sep): Consensus TBD, Previous -1.8. Signals manufacturing health, affecting Brazilian goods.
  
• 1:30 PM EST / 2:30 PM BRT – USD FOMC Member Williams Speaks: Policy insights influence currency and risk sentiment.
  
• 6:00 PM EST / 7:00 PM BRT – USD FOMC Member Bostic Speaks: Fed remarks impact emerging market flows.
  

Oceania and Other

• 4:30 AM EST / 5:30 AM BRT – GBP BoE Consumer Credit (Aug): Consensus 1.600B, Previous 1.622B. Signals consumer spending, relevant for global demand.
  
• 8:00 AM EST / 9:00 AM BRT – GBP MPC Member Ramsden Speaks: UK policy signals affect liquidity for Brazilian commodities.
  
• 7:00 PM EST / 8:00 PM BRT – NZD ANZ Business Confidence (Sep): Consensus TBD, Previous 49.7. Gauges economic activity, impacting commodity demand.
  
• 9:30 PM EST / 10:30 PM BRT – AUD Building Approvals (MoM) (Aug): Consensus 2.5%, Previous -8.2%. Signals construction activity, affecting metal demand.
  

These global events matter as they influence demand for Brazil's commodity exports (iron ore, oil, agriculture) and the real's stability amid robust FDI inflows, governance reforms, and aviation sector challenges.
Brazil's Markets Yesterday
Brazilian markets closed slightly higher on Friday, September 26, 2025, with the Ibovespa index up 0.10% at 145,447 points, reflecting resilience driven by financial sector strength despite commodity sector weaknesses.

The modest gain masked crosscurrents, with Banco do Brasil surging 1.47% and Santander Brasil rising 2.31% on share buyback announcements, bolstered by Brazil's 15% Selic rate boosting bank profits.

However, Vale dropped 1.92% as iron ore prices weakened in China, and Petrobras fell 0.34% despite rising global oil prices, signaling domestic factors outweighing commodity trends.

Ambev gained 1.1% on consumer sector optimism, while Ambipar plummeted 24% after debt restructuring concerns, highlighting corporate vulnerabilities.

The Ibovespa's monthly gain remains strong, supported by FDI inflows and governance improvements, though global trade uncertainties and Gol's halted merger talks with Azul added caution.

Global markets showed mixed performance. U.S. indices rose, with the Dow up 0.7%, S&P 500 up 0.6%, and Nasdaq up 0.4%, driven by stable inflation data, though trade policy concerns lingered.

European markets were flat, and Asian indices dipped, capping emerging market gains, yet Brazil outperformed peers like Mexico's IPC and Argentina's Merval.

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U.S. Markets Yesterday
On Friday, September 26, 2025, U.S. stock markets ended a three-day slide, with the Dow Jones Industrial Average up 0.7%, the S&P 500 up 0.6%, and the Nasdaq Composite up 0.4%.

Gains followed a core PCE inflation report matching expectations at 2.9% year-over-year, reinforcing stable monetary policy outlooks. President Trump's new tariffs on pharmaceuticals, trucks, and furniture sparked sector-specific volatility but did not derail the broader market.

Despite weekly declines, year-to-date returns remain robust. Investor caution persists due to trade policy uncertainties and potential government shutdown risks.
Commodities
Brazilian Real
The Brazilian real strengthened to USD/BRL 5.30 on September 26, 2025, gaining 0.3% weekly, supported by a $2 billion Central Bank dollar line auction and 40,000 swap contracts to cover maturing hedges.

Robust FDI inflows ($75 billion year-to-date) and a narrowed current account deficit (1.5% of GDP) bolstered the currency, despite a year-to-date decline of over 13%. The 15% Selic rate contrasts with the U.S. Fed's 4.5% rate, supporting resilience.

Technical indicators show a stabilizing trend (neutral MACD, RSI near 40), but trade tensions pose risks. Today's BCB Focus at 7:25 AM EST (8:25 AM BRT) and USD Pending Home Sales at 10:00 AM EST (11:00 AM BRT) will guide expectations.

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Oil Prices
Oil prices steadied, with Brent at $67.50 and WTI at $63.20 on September 26, despite global oversupply concerns. Prices were supported by geopolitical tensions and supply disruptions, including Ukraine's drone attacks on Russian refineries (1.1 million barrels/day offline).

Petrobras benefits from tariff exemptions on energy products, but Gol's halted merger talks signal fuel cost pressures. Today's CAD Manufacturing Sales at 8:30 AM EST (9:30 AM BRT) will clarify North American demand trends.

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Gold Prices
Gold held steady at $3,690/oz on September 26, up 40.9% year-to-date, driven by Fed rate-cut expectations, central bank purchases (166.5 tonnes in Q2), and geopolitical tensions.

ETF inflows of $5.5 billion in August support prices, with resistance at $3,700 and support at $3,620. This aids Brazil's mining exports. Today's EUR French BTF auctions at 9:00 AM EST (10:00 AM BRT) will signal liquidity trends.

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Silver Prices
Silver soared to a 14-year high of $44.10/oz on September 26, up 1.5% daily, fueled by industrial demand in solar and EVs, low inventories, and ETF inflows (96 million oz year-to-date).

India's festival demand and stable dollar liquidity (index 100.15) add support. This bolsters Brazil's mining sector. Today's EUR Consumer Confidence at 5:00 AM EST (6:00 AM BRT) will clarify industrial trends.

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Copper Prices
Copper rose to $10,050/tonne (LME) on September 26, driven by a deepening supply shortage from mine disasters (e.g., Indonesia's Grasberg closure) and rising EV/renewables demand projecting a 450,000-tonne deficit.

Inflows of $15 million to copper funds signal confidence. This supports Vale's exports. Today's CNY Manufacturing PMI at 7:30 PM EST (8:30 PM BRT) will provide demand clarity.

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Cryptocurrencies
Bitcoin fell 2.8% to $110,000 on September 26, pressured by $650 million in market liquidations and Fed rate-cut uncertainty.

Brazil's fintech sector, including Nubank's stablecoin push, remains cautious. Today's USD FOMC Williams speech at 1:30 PM EST (2:30 PM BRT) will influence digital asset trends.

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Iron Ore Prices
Iron ore stabilized at $105.80/tonne on September 26, supported by China's restocking (imports >113 million tonnes) despite a 3% steel output drop.

Inflows of $650 million to base metals and steady Australian/Guinean supplies aid Vale. Today's CNY Manufacturing PMI at 7:30 PM EST (8:30 PM BRT) will hint at Asian demand.

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Companies and Market
Industry Outlook
Brazil's economy is bolstered by a narrowed current account deficit (1.5% of GDP), $75 billion in FDI inflows, and Justice Fux's pledge to end solo judicial rulings, enhancing governance stability.

However, challenges persist with the 15% Selic rate, global trade tensions, and Gol's halted merger talks with Azul, signaling aviation sector hurdles.

The Ibovespa's 145,447 close reflects resilience, driven by banks like Banco do Brasil (+1.47%) and Santander Brasil (+2.31%), though Ambipar's 24% plunge underscores debt risks.

The real at 5.30 benefits from Central Bank interventions and FDI. Today's BCB Focus at 7:25 AM EST (8:25 AM BRT), IGP-M Inflation at 7:00 AM EST (8:00 AM BRT), and EUR Business and Consumer Survey at 5:00 AM EST (6:00 AM BRT) will shape demand for oil, mining, and financial sectors.
Key Developments
Economic Resilience: Current account deficit narrows to $33.5 billion, with FDI up 15% to $75 billion, signaling strong investor confidence in manufacturing and services.

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Aviation Sector Challenges: Gol's Abra halts merger talks with Azul due to fuel costs and competition, impacting consolidation plans despite Gol's expansion into Latin America and U.S. leisure routes.

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Governance Reform: Justice Fux vows to end solo judicial rulings, boosting institutional trust and investor sentiment.

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Corporate Struggles: Ambipar's 24% stock drop reflects debt restructuring concerns, highlighting vulnerabilities in high-rate environments.

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Commodity Trends: Iron ore ($105.80) steady on China's demand, oil ($67.50) supported by supply disruptions, copper ($10,050) on shortage fears, silver ($44.10) at 14-year highs.

Stock Market Dynamics: Ibovespa at 145,447 (+0.10%) with banks leading, offset by Vale (-1.92%) and Petrobras (-0.34%) declines, amid global mixed signals.

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Explanation of EST
Eastern Standard Time (EST) is the time zone used in the eastern United States, including New York, Washington, D.C., and Miami, set at UTC-5, five hours behind Coordinated Universal Time (UTC).

EST is applied here for consistency, aligning with U.S. financial market schedules, influencing global trading.

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