This isn’t unimportant-
BRLUSD
- Thread starter CopperOverGold
- Start date
This isn’t unimportant-
Indeed it is. American farmers are smiling. This is an overlay of Dec21 corn futures at CBOT, trending higher, vs. USDBRL futures for Jul21 (trending lower) at Brazil's B3.
Anyone exporting in the US is going to be happy, which is a boon to farmers. The canary just left the coal mine and can’t be found.
Lol. The dollar breaks 88. Play it your way (shrug). We all need bag holders.
Things are looking good for the Real on the back of:
-PPP cheapness
-Rising interest rate cycle
-Commodities are on the rise which Brazil exports a lot of. Economic projections are on the rise
-The fiscal situation is not as bad as feared due a big pop in Nominal GDP (a lot due to exports)
-The finance minister is still committed to market reforms although the President and the Congress like to slow that down as much as they can
on the bearish side
-Rates are rising due high inflation so net rates are quite negative
-The country is still fiscally vulnerable and a socialist president (Lula) could take over in 2022
-There is also the chance of a military coup if Bolsonaro loses in 2022. And the military historically has been heavy spenders of fiscal funds, they created the inflationary crisis of the 70's and 80's which ended up in hyperinflation
I expect further appreciation but when it comes to Brazil, anything can change at any given time
-PPP cheapness
-Rising interest rate cycle
-Commodities are on the rise which Brazil exports a lot of. Economic projections are on the rise
-The fiscal situation is not as bad as feared due a big pop in Nominal GDP (a lot due to exports)
-The finance minister is still committed to market reforms although the President and the Congress like to slow that down as much as they can
on the bearish side
-Rates are rising due high inflation so net rates are quite negative
-The country is still fiscally vulnerable and a socialist president (Lula) could take over in 2022
-There is also the chance of a military coup if Bolsonaro loses in 2022. And the military historically has been heavy spenders of fiscal funds, they created the inflationary crisis of the 70's and 80's which ended up in hyperinflation
I expect further appreciation but when it comes to Brazil, anything can change at any given time
We all have to believe in something. And I encourage you to trade your convictions.
If the point is, anything can happen, I agree. I didn’t have oil to -60 on my bingo card.
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All of these are likely coincidences. It’s really hard to fathom what any of these currency pairs have to do with each other.
Sentiment
The longer the base…
