Brazil’s Financial Morning Call for October 10, 2025
Brazil’s financial markets are navigating a complex landscape today, shaped by domestic policy developments and global economic signals.
Congress’s rejection of Provisional Measure 1,303, voted down 251–193 in the Chamber of Deputies to let it expire, has sparked a 2026 budget showdown.
The move blocks a R$17–21 billion ($3.21–$3.96 billion) revenue plan to fund income tax relief for workers earning up to R$5,000 ($943) monthly through taxes on billionaires, banks, and bets—while preserving LCI/LCA exemptions.
The decision has raised fiscal concerns and could trigger potential spending freezes of R$7–10 billion ($1.32–$1.89 billion) in parliamentary amendments.
Inflation pressures, with September’s IPCA at 0.48% month-on-month (5.17% year-on-year) and seasonally adjusted at 0.52%, topping 5% again due to fading tax exemptions, test the Central Bank’s 1.5–4.5% tolerance band and force a slower Selic path with measured, data-dependent cuts from 15%.
Quiet diplomatic resets between Foreign Minister Mauro Vieira and U.S. Secretary Marco Rubio, building on leaders’ calls October 6 and 9, aim to establish a standing channel for trade fixes amid 40% U.S. tariffs on Brazilian steel, foods, and goods—potentially unlocking exemptions and rollbacks to stabilize exports.
A Supreme Court vacancy from Justice Luís Roberto Barroso’s early retirement at 67 leaves the STF with 10 members, blending politics into Lula’s nomination process requiring Senate approval (41 yes votes), with implications for tax disputes, business costs, and judicial stability in economic rulings.
These developments set the stage for today’s key economic indicators, which will test Brazil’s resilience amid global uncertainties.
Economic Agenda for October 10, 2025
Brazil (10th Largest Economy, Nominal GDP: ~$2.125 trillion)
- 08:00 AM BRT – Brazilian PPI (MoM) (Aug)
Actual: TBD
Consensus: TBD
Previous: -0.30%
Implication: The PPI release will assess producer price pressures amid persistent 5.17% YoY inflation and fiscal uncertainty from the rejected MP 1,303.
A higher-than-expected PPI could signal stronger cost pass-through, pressuring the Selic rate (15%) and lifting USD/BRL from 5.38, impacting homebuilders (e.g., Tendas, Cyrela) and retailers. Softer data may support measured rate cuts, boosting consumer sectors and signaling fiscal-monetary alignment as U.S. tariff talks progress.
Key International Events
- 02:00 AM BRT – Norway: Inflation Data (Sep)
Core CPI YTD: Actual: 3.0%, Consensus: 3.1%, Previous: 3.1%
Core Inflation (MoM): Actual: 0.2%, Consensus: 0.4%, Previous: -0.7%
CPI (YoY): Actual: 3.6%, Consensus: 3.5%, Previous: 3.5%
CPI (MoM): Actual: 0.4%, Consensus: 0.3%, Previous: -0.6%
Implication: Softer Norwegian core inflation may ease global energy price pressures, indirectly supporting Petrobras’ margins as it revives fertilizer production to cut import reliance.
- 03:00 AM BRT – Switzerland: SECO Consumer Climate (Sep)
Actual: -37
Consensus: -38
Previous: -40
Implication: Improved Swiss sentiment signals stabilizing European demand, potentially aiding Brazil’s soy and steel exports despite U.S. tariff headwinds.
- 04:55 AM BRT – Italy: Industrial Production (Aug)
MoM: Actual: TBD, Consensus: -0.3%, Previous: 0.4%
YoY: Actual: TBD, Consensus: 0.5%, Previous: 0.9%
Implication: A Eurozone slowdown, if confirmed, could cap gains for Brazil’s commodity exporters like Vale, though Vieira-Rubio trade talks may offset risks.
- 05:10 AM BRT – Italy: 12-Month BOT Auction
Actual: TBD
Consensus: TBD
Previous: 2.030%
Implication: Higher yields could strengthen the euro, pressuring Brazil’s export competitiveness as trade reset talks continue.
- 06:00 AM BRT – Eurozone: ECOFIN Meetings
Implication: Fiscal policy discussions may influence euro stability, affecting Brazil’s trade balance with Europe amid tariff negotiations.
- 07:30 AM BRT – India: FX Reserves, USD
Actual: TBD
Consensus: TBD
Previous: 700.24B
Implication: Stable Indian reserves support emerging market flows, indirectly bolstering Brazil’s fiscal credibility post-MP 1,303 lapse.
- 08:00 AM BRT – Mexico: Industrial Production (Aug)
MoM: Actual: TBD, Consensus: 0.4%, Previous: -1.2%
YoY: Actual: TBD, Consensus: -2.2%, Previous: -2.7%
Implication: Mexican recovery could lift regional trade, but a firm dollar pressures LatAm currencies like BRL.
- 08:30 AM BRT – Canada: Labor Market Data (Sep)
Average Hourly Wages: Actual: TBD, Consensus: TBD, Previous: 3.6%
Employment Change: Actual: TBD, Consensus: 2.8K, Previous: -65.5K
Full Employment Change: Actual: TBD, Consensus: TBD, Previous: -6.0K
Part-Time Employment Change: Actual: TBD, Consensus: TBD, Previous: -59.7K
Participation Rate: Actual: TBD, Consensus: TBD, Previous: 65.1%
Unemployment Rate: Actual: TBD, Consensus: 7.2%, Previous: 7.1%
Implication: Softening Canadian labor data may weaken commodity demand, pressuring Petrobras shares amid its Equatorial Margin licensing challenges.
- 09:45 AM BRT – US: Fed Goolsbee Speaks
Implication: Dovish signals could ease dollar strength, supporting BRL recovery from 5.38 and aiding tariff-impacted exports.
- 10:00 AM BRT – US: Michigan Consumer Sentiment (Oct)
1-Year Inflation Expectations: Actual: TBD, Consensus: TBD, Previous: 4.7%
5-Year Inflation Expectations: Actual: TBD, Consensus: TBD, Previous: 3.7%
Consumer Expectations: Actual: TBD, Consensus: 51.7, Previous: 51.7
Consumer Sentiment: Actual: TBD, Consensus: 54.1, Previous: 55.1
Current Conditions: Actual: TBD, Consensus: 60.0, Previous: 60.4
Implication: Rising U.S. sentiment could strengthen the dollar, challenging USD/BRL stability at 5.38 amid Brazil’s fiscal concerns.
- 01:00 PM BRT – US: Baker Hughes Rig Count
Oil Rig Count: Actual: TBD, Consensus: TBD, Previous: 422
Total Rig Count: Actual: TBD, Consensus: TBD, Previous: 549
Implication: Higher rig counts may cap oil prices, impacting Petrobras’ fertilizer revival and export margins.
- 02:00 PM BRT – US: Federal Budget Balance (Sep)
Actual: TBD
Consensus: 50.0B
Previous: -345.0B
Implication: A narrowing U.S. deficit could bolster the dollar, exacerbating BRL weakness and LatAm risk premia.
Why These Events Matter: Brazil’s PPI data at 08:00 AM BRT will test producer inflation trends against fiscal uncertainty from the MP 1,303 rejection and STF vacancy politics, shaping the Selic path and USD/BRL at 5.38.
Norwegian inflation and Italian production provide commodity cues for Vale and Petrobras, while U.S. sentiment, budget data, and Goolsbee’s speech drive dollar dynamics critical for Brazil’s trade reset with Rubio-Vieira talks.
Canadian jobs and Mexican output influence regional flows, as emerging market currencies face pressure with DXY near 99.
Brazil’s Markets Yesterday
Brazil’s Ibovespa fell 0.31% to 141,708.19 on October 9, 2025, with the real weakening to 5.3750 per dollar, as domestic policy setbacks collided with a softer global backdrop pushing investors toward the dollar and away from risk.
Lawmakers withdrew MP 1,303, reviving doubts about revenue delivery in the fiscal framework, while September IPCA at 0.48% MoM (5.17% YoY)—softer than forecast—shifted focus to credibility, with Selic at 15% allowing the central bank to wait but not the fiscal path.
Petrobras and Vale declined on easing oil and insufficient iron ore support; big banks were mixed. WEG outperformed on Light’s concession renewal unlocking investments in equipment; Brava Energia led declines on a Potiguar Basin halt during ANP audit. Turnover moderate, signaling caution.
Technical: Ibovespa faces resistance at 142,000–143,000, with support at 140,500–139,000. Fiscal wobbles and dollar firmness may spur volatility.
U.S. Markets Yesterday
The S&P 500 slipped 0.28% to 6,735.11, Dow fell 0.52% to 46,358.42, Nasdaq dipped 0.08% to 23,024.63, and Russell 2000 declined 0.61% to 2,468.85 on October 9, 2025. Dell weighed on tech, while Delta Air Lines rose on strong results and guidance.
Treasury yields held at ~4.14% (10-year), USD/JPY ~153.1 after highs. WTI fell $1.04 to $61.51; Brent $1.03 to $65.22 as geopolitics eased; spot gold ~$3,975 after topping $4,000. Fed messages and shutdown paused rally ahead of earnings.
Mexico’s Market Yesterday
Mexico’s S&P/BMV IPC dipped 0.11% to near 60,819 on October 9, 2025, with the peso at ~18.38 per dollar. Firm dollar and U.S. yields cooled risk appetite, but September inflation at 3.76% and U.S. export demand cushioned.
Winners: Grupo México +2.37%, Grupo Carso +2.31%; losers: Gentera -3.39%. Support at 60,300–60,700, resistance at 61,100–61,300.
Argentina’s Market Yesterday
Argentina’s S&P Merval rallied ~5.8% on October 9, 2025, led by banks/utilities, with peso gaps shrinking on Washington support easing hoarding.
ADRs and ETF saw heavy turnover. Winners: Metrogas +17.09%, BYMA +16.57%; support at recent averages, resistance at highs for confirmation.
Colombia’s Market Yesterday
Colombia’s COLCAP rose 0.75% to 1,889.25 on October 9, 2025, with peso at ~3,891 per dollar. Debt swaps and 9.25% rates supported amid dollar firmness; Winners: Mineros +5.11%. Support at 1,866–1,856, ceiling at 3,905–3,920 for USD/COP.
Chile’s Market Yesterday
Chile’s S&P CLX IPSA slipped 1.0% to 8,818.7 on October 9, 2025, with peso at ~950 per dollar. Stronger dollar blunted copper rally (~$11,000/ton); September CPI 0.4% MoM (4.4% YoY), rate at 4.75%. Winners: Grupo Security +4.3%; stuck near 8,800–8,900.
Commodities
Brazilian Real
The real slipped to ~5.38 per dollar on October 9, 2025, with USD/BRL at 5.3800 (+0.6%), driven by global dollar demand overshadowing softer oil and 15% Selic cushion, plus MP 1,303 withdrawal muddling revenues and ETF outflows on fiscal doubts—despite softer IPCA at 5.17% YoY.
Fiscal uncertainty and DXY near 99 raise risk premia, testing resistance at 5.40–5.45 with support at 5.35–5.33. RSI mid-60s, MACD higher; U.S. shutdown headlines or tariff resets could push to 5.50, while disinflation aids 5.30. Year-end forecast ~5.25 with clarity.
Cryptocurrencies
Bitcoin paused near $121,400 on October 9, 2025, with Ether at $4,357, Solana ~$220.9, XRP ~$2.821, Litecoin ~$129.17. ETF inflows hit $255M Thursday ($2.2B week), but no Brazil-specific adoption noted amid high Selic curbing retail interest. Support at $118,000–$119,000, resistance $124,000.
Companies and Market
Industry Outlook
Brazil’s stock market faces heightened uncertainty after Congress rejected MP 1,303, preserving LCI/LCA exemptions but blocking R$17–21 billion in revenues needed for 2026 fiscal stability.
The move has lifted long-dated rates and pressured rate-sensitive sectors like homebuilders and retailers amid inflation at 5.17% year-on-year from fading exemptions, while STF vacancy politics add judicial risks to future tax rulings.
Global dollar firmness and U.S. tariffs (40% on steel and foods) pose headwinds, but the Vieira-Rubio resets offer potential trade relief.
Petrobras’ fertilizer revival and Light’s upgrade cycle support energy and industrials, while Cyrela’s R$5 billion in launches signal housing resilience despite Tenda’s 27% Q3 drop. Fiscal credibility remains a focal point amid ongoing Equatorial Margin licensing standoffs.
Key Developments
Cyrela launched 18 projects worth R$5.05B (+62% YoY) in Q3, with sales R$3.547B (+11%), signaling resilient urban demand and confidence in affordable housing despite tighter budgets; YTD launches R$14.039B (+123%), with 84% consolidated.
Petrobras is reactivating FAFEN-BA and FAFEN-SE plants for urea/ARLA 32 from early 2026, investing R$76M ($14M) total and R$1B O&M contract, targeting 20% of Brazil’s 8M-tonne nitrogen demand to cut imports, supporting 800 jobs (+1,400 in Sergipe) and farm stability.
Light plans record capex on substations/transformers post-2026 concession renewal, boosting grid reliability; WEG poised for equipment orders, shares +5% to R$37.28 on October 9 amid YTD -30% trim.
Tendas’ Q3 launches fell 27% to R$1.56B (14 projects), sales R$1.23B net, cancellations +44% to R$176M on buyer caution and high prior base from São Paulo program; land bank +27% to R$26.19B positions for ramp-up, VSO at 26.6%.
Prosecutors challenge Petrobras’ FZA-M-59 license in Equatorial Margin over August drill deviations (unapproved boats, night ops), demanding rerun; Ibama approved “in concept” but risks court halt, delaying rigs (~R$4M/day idle) in biodiverse frontier akin to Guyana.
No specific company developments beyond these for October 10, 2025, in the provided data. Market dynamics driven by fiscal lapses, inflation persistence, and trade resets, with rate-sensitive homebuilders (Cyrela/Tendas) mixed, utilities/industrials (WEG/Light) resilient, and energy (Petrobras) facing regulatory hurdles amid global softness.
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Brazil Morning Call — Live Board
-0.01%
185,188.13
-0.01%
65,473.16
+0.91%
11,315.26
-1.14%
3,062,910
-1.39%
2,535.71
+1.86%
59,719.97
+0.50%
| Instrument | Last | Change | YoY | Prev. | High | Low | Volume |
|---|---|---|---|---|---|---|---|
| IBOV | 185,188.13 | -0.01% | +21.85% | 185,205.09 | 168,310 | 167,142 | — |
| USD/BRL | 5.16 | +0.01% | -5.13% | 5.16 | 5.18 | 5.14 | — |
| EUR/BRL | 5.95 | +1.01% | -5.83% | 5.89 | 5.98 | 5.94 | — |
| SELIC | 14.00% | — | — | — | — | — | |
| BRENT | 88.88 | -0.03% | +34.42% | 88.91 | 90.07 | 88.12 | 29,713 |
| WTI | 83.11 | -0.11% | +31.57% | 83.20 | 84.35 | 82.40 | 166,848 |
| IRON ORE | 161.91 | — | +58.10% | 161.91 | 161.91 | 1 | |
| GOLD | 4,461 | +1.78% | +33.20% | 4,383 | 4,503 | 4,421 | 139,824 |
| SILVER | 65.59 | +1.26% | +73.05% | 64.77 | 66.98 | 64.81 | 46,406 |
| LITHIUM | 75.20 | +1.47% | +62.95% | 74.11 | 75.80 | 75.08 | 89,275 |
| SOY | 1,184 | +3.20% | +17.05% | 1,148 | 1,199 | 1,168 | 163,179 |
| CORN | 480.50 | +10.02% | +29.34% | 436.75 | 480.75 | 459.50 | 341,248 |
| WHEAT | 655.00 | +3.93% | +29.70% | 630.25 | 657.75 | 631.50 | 128,793 |
| COFFEE | 317.25 | -5.51% | +0.67% | 335.75 | 321.20 | 313.55 | 21,747 |
| SUGAR | 16.43 | -1.79% | -3.01% | 16.73 | 17.11 | 16.22 | 171,992 |
| ORANGE JUICE | 138.55 | -0.47% | -45.38% | 139.20 | 141.05 | 137.50 | 703 |
| COTTON | 85.03 | +2.33% | +26.78% | 83.09 | 82.90 | 81.96 | 16,546 |
| BEEF | 223.60 | -3.93% | -5.18% | 232.75 | 226.40 | 223.00 | 16,126 |
| CATTLE | 339.10 | -3.16% | -1.82% | 350.17 | 345.50 | 338.60 | 10,164 |
| COCOA | 5,719 | +3.18% | -34.96% | 5,543 | 5,779 | 5,574 | 26,773 |
| PETR4 | 41.64 | -0.05% | +35.19% | 41.66 | 41.97 | 41.15 | 41,499,400 |
| VALE3 | 72.97 | +0.83% | +30.75% | 72.37 | 73.54 | 72.66 | 17,658,000 |
| SUZB3 | 41.33 | +2.35% | -23.55% | 40.38 | 41.48 | 40.35 | 3,914,900 |
| KLABIN | 17.69 | +0.80% | -2.95% | 17.55 | 17.74 | 17.48 | 2,057,400 |
| SLCE3 | 13.34 | +0.30% | -12.25% | 13.30 | 13.42 | 13.20 | 1,454,200 |
| ABEV3 | 14.89 | -0.80% | +21.91% | 15.01 | 15.07 | 14.81 | 16,453,100 |
| ITUB4 | 38.60 | -1.03% | +4.57% | 39.00 | 39.34 | 38.39 | 29,487,800 |
| BBDC4 | 16.85 | +0.36% | +3.50% | 16.79 | 16.90 | 16.67 | 19,416,900 |
| BBAS3 | 19.37 | +0.47% | +0.73% | 19.28 | 19.44 | 19.16 | 11,069,200 |
| B3SA3 | 14.26 | -0.21% | +12.73% | 14.29 | 14.47 | 14.11 | 33,037,800 |
| WEGE3 | 47.59 | +0.49% | +29.99% | 47.36 | 48.08 | 47.36 | 3,364,600 |
| PRIO3 | 59.14 | -0.19% | +50.67% | 59.25 | 59.81 | 58.74 | 3,325,600 |
| RENT3 | 34.68 | -0.09% | +0.84% | 34.71 | 34.96 | 34.35 | 7,979,100 |
| AZZA3 | 15.89 | -2.63% | -53.76% | 16.32 | 16.42 | 15.82 | 1,330,300 |
| CSNA3 | 4.30 | +0.47% | -42.65% | 4.28 | 4.41 | 4.26 | 10,076,100 |
| GGBR4 | 24.69 | +2.19% | +51.38% | 24.16 | 24.85 | 24.18 | 7,047,600 |
| ENEV3 | 24.21 | -1.38% | +70.49% | 24.55 | 24.64 | 23.99 | 9,297,000 |
| LREN3 | 11.87 | -1.33% | -28.65% | 12.03 | 12.17 | 11.83 | 9,683,300 |
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