Brazil’s Financial Morning Call for January 19, 2026

This is part of The Rio Times’ daily Brazil Financial Morning Call, covering Latin American financial markets.

Today’s Key Themes

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• EU-Mercosur trade deal → Signed on January 17, 2026, eliminating tariffs on over 90% of goods, covering €111B in 2024 trade and 720M consumers, expanding Brazil’s import access from 8% to 36% of global goods while boosting exports like beef (99K tonnes quota) and poultry (180K tonnes), with immediate zero tariffs on 82.7% of Brazil’s EU exports to rewire Atlantic ties amid U.S. tariff threats

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• Lithium and rare earths bet → Brazil positions as Europe’s key supplier with ~10% of global critical mineral reserves; projects like Serra Verde (5K tonnes/year rare earth oxides), Sigma Lithium (270K tonnes concentrate, expanding to 520K despite regulatory shutdowns), and Terra Brasil ($1B investment) draw joint EU pacts for investments, enhancing battery and tech supply chains beyond exports

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• Offshore oil milestone → Petrobras averages 2.4M bpd oil in 2025 (up 11% YoY), total 2.99M boe/d above guidance via pre-salt ramps like Búzios P-78 (180K bpd capacity) and Tupi optimizations, supporting exports and energy security despite strikes

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• Ibovespa pullback → Index dips 0.46% from records amid iron ore slide to ~$116.55/ton and stronger IBC-Br reviving higher-for-longer rates debate

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• Currency firmness → Real holds near R$5.3726 despite USD lift from Fed politics

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• Metals surge → Gold and silver hit records on tariff fears, with gold up 1.6% to $4,666/oz and silver up 4.0% to $93.50/oz

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\nBroader risk: U.S. tariff threats on Europe/Greenland, Fed succession (Warsh 61% odds), and EM volatility could amplify FX, equities, and commodity swings, offset by Brazil’s rate differential and trade pacts
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Economic Agenda for January 19, 2026

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Brazil

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• 6:25 AM BRT – BCB Focus Market Readout Cons: – Prev: –

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Mexico

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• No major releases today.

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Argentina

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• No major releases today.

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Chile

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• No major releases today.

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Colombia

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• No major releases today.

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United States

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• All Day – Holiday: Martin Luther King, Jr. Day Cons: – Prev: –

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Canada

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• 8:30 AM EST – CPI (YoY) (Dec) Cons: 2.2% Prev: 2.2%

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• 8:30 AM EST – Core CPI (YoY) (Dec) Cons: – Prev: 2.9%

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• 10:30 AM EST – BoC Business Outlook Survey Cons: – Prev: –

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EU

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• 5:00 AM CET – Core CPI (YoY) (Dec) Cons: 2.3% Prev: 2.4%

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• 5:00 AM CET – CPI (YoY) (Dec) Cons: 2.0% Prev: 2.1%

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• 5:00 AM CET – Eurogroup Meetings Cons: – Prev: –

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UK

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• 9:00 AM GMT – NIESR Monthly GDP Tracker (Dec) Cons: – Prev: -0.1%

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India

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• No major releases today.

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\nImplication: Today’s Brazilian BCB Focus Market Readout offers insights into market expectations for inflation, growth, and rates, potentially affirming resilience amid fiscal scrutiny and oil strength to support the real and equities.
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\nCanadian CPI metrics (YoY headline at 2.2% cons, core at prev 2.9%) and BoC Business Outlook Survey gauge inflation trends and business sentiment, where softer reads could fuel easing bets and lift EM assets like BRL, while stickier figures bolster the dollar.
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\nEU Core CPI (2.3% cons) and headline CPI (2.0% cons) test disinflation progress, with Eurogroup Meetings discussing fiscal and growth coordination—lower inflation could ease ECB pressures, aiding risk mood.
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\nUK NIESR GDP Tracker signals Q4 momentum, where weakness might pressure sterling but support global easing hopes. Overall, U.S. holiday thins liquidity, amplifying reactions to these releases amid tariff fears and Fed politics.
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Brazil’s Markets on Friday

\nIbovespa -0.46% to 164,799.98 on R$34.1 billion turnover. Metals slide pressured Vale and steelmakers, stronger IBC-Br (+0.70% Nov) revived higher-for-longer rates debate rotating out of rate-sensitives; Petrobras +1% limited damage on dividend hopes
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Commodity Markets

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• Gold – Around $4,666.65/oz up 1.6%; surged on U.S. tariff threats to Europe/Greenland igniting safe-haven rush, weakening dollar and boosting hard assets after brief profit-taking

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• Silver – Around $93.50/oz up 4.0%; outperformed on risk-off flows, hitting $94.08 briefly as momentum trade, though flagged as “too fast”

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• Copper – Around $5.88/lb up 0.8%; firmed with dollar weakness and China growth support despite tariff anxiety

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• Platinum – Around $2,353.25/oz up 1.1%; climbed with precious-metals bid as investors hedge

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• Palladium – Around $1,804.06/oz up 0.2%; smaller gain, favoring haven over auto-demand optimism

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• Aluminium – Around $3,139.50/ton down 0.04%; held near highs on tight supply and shrinking inventory trends

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• Iron Ore – Around $107.15/ton flat; thin action awaiting China steel signals

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Currency

\nBrazilian Real → Held firm near R$5.3726 (range 5.3650–5.3951); supported by strong IBC-Br reducing stagnation risks and delaying cuts, high rates attract carry; countered marginal USD lift from Fed succession politics (Warsh 61% odds) and hawkish expectations
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Companies and Market

\nPetrobras Hits 2.4 Million bpd in 2025, Strengthening Brazil’s Offshore Output Story → Averaged 2.4M bpd oil (up 11% YoY), total 2.99M boe/d above guidance via pre-salt like Búzios P-78 (180K bpd) and Tupi; supports exports despite December strikes and political noise
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\nMercosur And The EU Sign A Trade Deal That Could Rewire The Atlantic Economy → Signed Jan 17, covers 720M consumers/€21.7T GDP, eliminates 90%+ tariffs, €111B 2024 trade; Brazil gains EU access, quotas (99K tonnes beef, 180K poultry), safeguards; strategic vs U.S. tariffs
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\nFrom 8% To 36%: The EU Deal That Expands Brazil’s Trade Reach Overnight → Expands import access to 36% global goods; immediate 82.7% tariff-free Brazil EU exports, $48.2B 2024 exports/$47.2B imports; supports 21.8K jobs/R$1B exported; staged reductions, $290B EU investment stock
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\nBrazil Becomes Europe’s New Bet For Lithium And Rare Earths → ~10% global reserves draw EU pacts; Serra Verde (5K tonnes/year oxides, $465M US loans), Sigma Lithium (270K tonnes concentrate, expanding to 520K despite shutdowns), Terra Brasil ($1B investment); enhances supply chains, requires transparency
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U.S. Markets on Friday

\nChoppy close: Dow -0.2% to 49,359.33, S&P 500 -0.1% to 6,940.01, Nasdaq -0.1% to 23,515.39. Weekly: S&P -0.4%, Dow -0.3%, Nasdaq -0.7%; Russell 2000 +0.1% to 2,677.74 (+2.0% week). Banks led early earnings, chips offset softness; Fed politics, credit-cap debate pressured financials.
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Regional Peers — Mixed:

\nColombia’s Peso Firms as Bond Dollars Meet a Quieter Global Tape → USD/COP 3,692.8 flat, TRM 3,700.05; $5B bond sale conversions support; MSCI COLCAP +2.53% to 2,345.40 records
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\nPeso Finds Its Footing As Mexico Shares Hold Near Records On Thin Holiday Trade → USD/MXN ~17.65 stabilized (RSI 28 oversold); S&P/BMV IPC ~67,141 near 67,657 peak
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\nArgentina Peso Calm Holds In The Morning As The Merval Stalls → Peso steady, Merval flat amid morning calm
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\nChile’s Peso Holds Near 886 As IPSA Rallies On A Late Institutional Surge → USD/CLP 887.01 (range 886.2–886.5); S&P IPSA +0.62% to 11,156.73, led Itaú +5.3%
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\nNote: Crypto markets cool after overnight selloff as tariff fears return → Bitcoin -3% ~$92,563, Ether -3% ~$3,201; $780M long liquidations expose leverage
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Related coverage: Ibovespa session | dollar-real exchange rate