Alfredo Gimenez
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What is the economic impact of Bolsonaro's conviction?
Many are asking this question and it seems that there are already two types of people opining on the matter:
- Those who seek statements from authorities in Brazil and the USA critical of the trial in search of future sanctions and other retaliations for Brazil having displeased Trump. This group would love for the threats to materialize or at least scare off investors, destabilizing the economy.
- Those who seek news about the real reaction of investors and global media. These know that the statements of American bureaucrats and the president most of the time do not go beyond the limit of threats and that real actions have less impact or are merely symbolic.
Beyond Donald Trump's bluster and the desires of the extreme right opposition leaders, what do we have concrete in the economy:
- The dollar had a record depreciation and closed at 3.35 Reais
- The Brazilian stock market hit a new record and reached 144 thousand points
- The USA eliminated the tariff on Brazil's Cellulose, Nickel, and Iron
- Exports of meat, coffee, steel, and other products subject to tariffs INCREASED, reaching other markets.
- Overall Brazilian exports had an 18% increase in the last quarter, even having dropped to the USA.
This setback in expectations from the USA is related to seasonal issues, such as the industrial decline in Argentina increasing Brazil's exports, and secondary impacts from Trump's tariffs on other countries, which began to buy from Brazil instead of the USA.
This is the case of China, which simply STOPPED buying American Soy and increased orders from Brazil.
Another example is the Medical sector, which had the USA as its main meat supplier but, due to supply issues, redirected purchases to Brazil and has already become our main market.
These advantageous rearrangements allow Brazil to buy time and develop new strategies.
Meanwhile, the USA suffers immediate impacts on the economy and no longer has time to play the blackmailer.
Many are asking this question and it seems that there are already two types of people opining on the matter:
- Those who seek statements from authorities in Brazil and the USA critical of the trial in search of future sanctions and other retaliations for Brazil having displeased Trump. This group would love for the threats to materialize or at least scare off investors, destabilizing the economy.
- Those who seek news about the real reaction of investors and global media. These know that the statements of American bureaucrats and the president most of the time do not go beyond the limit of threats and that real actions have less impact or are merely symbolic.
Beyond Donald Trump's bluster and the desires of the extreme right opposition leaders, what do we have concrete in the economy:
- The dollar had a record depreciation and closed at 3.35 Reais
- The Brazilian stock market hit a new record and reached 144 thousand points
- The USA eliminated the tariff on Brazil's Cellulose, Nickel, and Iron
- Exports of meat, coffee, steel, and other products subject to tariffs INCREASED, reaching other markets.
- Overall Brazilian exports had an 18% increase in the last quarter, even having dropped to the USA.
This setback in expectations from the USA is related to seasonal issues, such as the industrial decline in Argentina increasing Brazil's exports, and secondary impacts from Trump's tariffs on other countries, which began to buy from Brazil instead of the USA.
This is the case of China, which simply STOPPED buying American Soy and increased orders from Brazil.
Another example is the Medical sector, which had the USA as its main meat supplier but, due to supply issues, redirected purchases to Brazil and has already become our main market.
These advantageous rearrangements allow Brazil to buy time and develop new strategies.
Meanwhile, the USA suffers immediate impacts on the economy and no longer has time to play the blackmailer.
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