FX.co ★ Brazilian Stocks Ease from Record

Brazil's Ibovespa index experienced a decline of over 0.5% from its previous record high, falling below the 165,000 mark on Friday. This downturn was driven by widespread losses across most key sectors as investors continued to assess the future trajectory of Brazilian interest rates. Notably, the IBC-Br economic activity index, commonly viewed as a preliminary indicator for official GDP figures, increased by 0.7% from the prior month in November. This exceeded market forecasts of a 0.3% rise, marking the most significant increase since March of the previous year. These figures contribute to a series of indicators demonstrating sustained growth, such as historically low unemployment rates, recoveries in PMIs, and a resurgence in retail sales. Consequently, there appears to be less urgency for the central bank to implement rate cuts this year. Retail and banking stocks took a hit, with Assai, Itau, and Bradesco each experiencing declines of over 1%.