Year begins with stock market on all-time high and stronger real

In the 10 days since the inauguration of President Jair Bolsonaro, important economic indicators such as the dollar exchange rate and the stock market showed significant improvements, a sign of increased investor confidence. The Ibovespa, Brazil's benchmark stock market index, climbed a remarkable 6.5% since January 1st.

From 87,887 points on December 31st (according to data from B3, the São Paulo Stock Exchange), the Ibovespa has since risen to hit record highs. On January 11, for example, it closed at 93,658 points.

Reforms

Proposals being prepared by the federal government, such as the pension system reform and other economic measures to improve the country’s fiscal and economic conditions, have created positive expectations among investors.

The Ibovespa is an important indicator, acting as a barometer of investor confidence in Brazil. If the stock market goes up, it means that there are expectations that the productive sector will generate more wealth and that the country will grow.

Stronger real

Another important gauge is the dollar exchange rate. According to the Central Bank, the US currency closed at R$ 3.87 for sale on December 31. This Friday, it ended the day selling at R$ 3.71 - a 4.13% drop in the period.