FX.co ★ Ibovespa Retreats from Record High

The Ibovespa index declined by approximately 0.2%, dipping below the 140,700 mark on Friday. This pullback from its previous record high came as investors prepared for potential trade disturbances and absorbed recent economic data to assess the impact of monetary policies. With the July 9th deadline for Trump's reciprocal tariffs approaching, companies reliant on exports remain on alert. These tariffs, potentially reaching up to 70% on Brazilian steel, aluminum, and other goods, pose a threat to the recent recovery of the country's trade surplus. In domestic economic news, May saw the Producer Price Index (PPI) drop by 1.29%, the most significant decrease in nearly two years, indicating pressure on output prices and profits. This occurred alongside a second consecutive monthly decline in industrial production, suggesting a broader slowdown in economic activity influenced by the central bank's 15% Selic rate and ongoing fiscal uncertainties related to the IOF tax debate in Congress. Despite these challenges, the São Paulo exchange recorded new peaks, setting the stage for an impressive weekly gain exceeding 2.5%.