FX.co ★ Ibovespa Falls as Tariff Uncertainty Weighs on Sentiment

The Ibovespa index experienced a decline of nearly 1%, falling under the 133,000 mark on Monday. This movement was driven by investors reducing exposure to riskier assets in anticipation of the August 1st deadline for the United States to potentially impose tariffs on Brazil. President Trump has threatened to introduce tariffs of 50% on Brazilian imports starting this Friday, citing the alleged unjust political treatment of former President Bolsonaro and claiming unfair trade practices, despite the fact that the U.S. maintains a trade surplus in goods with Brazil. This situation is further exacerbated by the broader tariff threats aimed at BRICS nations. Domestically, the focus remains on the ongoing tension between the executive and legislative branches regarding a potential increase in the financial transaction tax. On the corporate side, shares of Vale declined by 1.4%, Petrobras by 1.2%, with steelmakers CSN dropping 1.7% and Gerdau slightly decreasing by 0.1%. Meanwhile, the major banks showed mixed results, with Itaú Unibanco slipping by 0.3% while Banco do Brasil saw a modest increase of 0.2%.