FX.co ★ Ibovespa Drops on Mid-Month Inflation Surge

The Ibovespa retreated nearly 1% on Friday, slipping below 189,500 points, pressured by a mid-February inflation reading that surprised to the upside. The IPCA-15 advanced 0.84%, driven mainly by higher education and transportation costs, dampening expectations for more aggressive cuts to the Selic rate and pushing up interbank deposit rates. Performance among major banks was mixed: Itaú and Banco do Brasil each fell more than 1%, while Bradesco rose about 2% after its CEO projected that the group’s new healthcare operations could reach a market value of R$50 billion. Axia dropped more than 3% following a 37% year-on-year decline in profit. In contrast, Petrobras gained nearly 1%, supported by the rise in international oil prices.