FX.co ★ Ibovespa Drops to 1-Month Low

On Monday, the Ibovespa index fell by 0.3%, closing at 135,699, marking a one-month low. This dip followed the announcement by Finance Minister Fernando Haddad of a provisional measure intended to "recalibrate" the IOF decree issued last month. The new plan, crafted in agreement with congressional leaders, shifts the focus from initial transaction-tax hikes to imposing levies on securities that were previously exempt and increasing rates on sports betting. However, it notably avoids any spending cuts, thereby raising concerns about Brazil’s fiscal future. On the international front, attention is centered on the US–China trade discussions taking place in London this week, as well as upcoming US inflation data that may influence the Federal Reserve's policy decision. Domestically, the Brazilian stock exchange, B3, led the decline with a 2.7% decrease, followed by steelmaker CSN, which fell 2%, and Ambev, which slipped by 0.9%. However, some of these losses were mitigated by a 1.9% rise in meat-packers JBS, fueled by expectations of continued strong export demand.